Global Stock Market: Dow ends the volatile week higher

 

Global Stock Market Indexes-Weekly Updates: The global stock markets ended the volatile week higher despite the ongoing fears about the banking system. The frontline indexes in the US, Europe, Japan, and China gained after the central bank’s monetary policy and improved economic data during the week.

 

The US Stock Market indexes- Weekly Updates

 

The frontline indexes in US markets, Dow Nasdaq and S&P 500 ended higher while smallcap closed lower during the week. The banking sector crisis and recession worries weighed on value stocks and small-caps while tech-heavy Nasdaq outperformed the other frontline indexes. 

This week’s crucial event, the Federal Reserves meeting ended on Wednesday and was in line with expectations. Fed hinted that the rate hike cycle is likely to end after one more hike in May and no rate cut in the current year. However, the futures markets started pricing the rate cut, the CME FedWatch Tool is showing a 94.8% chance that cuts would start this summer.

However, on Wednesday, US Treasury Secretary Janet Yellen’s remarks for not considering providing “blanket insurance” for banking deposits weigh on market sentiments and created some volatility in the markets.

On the economic front, the weekly jobless claim remained near a five-decade low. S&P Global’s Composite Index of both services and manufacturing flash data shows the fastest pace of private sector growth since last May due to new orders. The fresh data regarding core capital goods orders also surprised the higher side.

On a weekly basis, the S&P 500 gained 1.4 percent, the Dow rose 1.2 percent and the Nasdaq index climbed 1.7 percent.

 

European Stock Market Indexes- Weekly Updates

 

European stock market indexes closed higher for the week despite weakness in the banking and financial stocks. The pan- European Stoxx 600 index ended higher by 0.87 percent. On a weekly basis, the key European stock market indexes, CAC and DAX gained 1.30 percent and 1.28 percent respectively while FTSE was up by 0.96 percent.

The banking shares pared all early gains and started selloff again due to concerns over the health of the financial sector. The Bank of England (BoE) raised interest rates as widely expected with no aggressive move despite a surprise surge in the inflation rate. The latest private survey also shows an expansion of manufacturing and services activity in the UK.

The preliminary reading shows that the Eurozone business activity is in expansion in March while manufacturing activity struggles in most of the countries, especially in Germany.

 

Asian major stock markets indexes

 

Japan’s stock market index Nikkei closed marginally higher by 0.19 percent during the week. The sentiment become positive after the recent developments to bail out or support the troubled regional banks in US and Europe. On the economic front, the inflation rate eased from a record high.

A huge divergence was seen in the manufacturing and services sector, as a strong development was seen in the activity of the service while a contraction was reported in the manufacturing activity due to a fall in new orders.

China’s Shanghai index also made decent gains of 0.46 percent while Hang Seng added 2.03 percent during the week. The sentiments become positive after the People’s Bank of China left its 1 & 5-year loan prime rate unchanged.

China’s fiscal revenues fell 1.2% in Jan & Feb of 2023 compared to the same period last year, while expenditures rose by 7%, this is due to weakness in the property sector even after the government’s continued support.

 

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