Global Stock Market Weekly Analysis (20- 24 Nov 2023)
Global Stock Market
The global stock market indexes mostly closed higher during the week. It was a holiday-shortened week for the US and Japan and mainly focused on the quarterly earnings, flash PMI data, and signals from the central banks regarding interest rates.
The US Stock Markets – Weekly Updates
The US stock markets closed higher during the quiet holiday-shortened trading week. The markets were shut on Thursday on account of Thanksgiving Day and also closed half trading session on Friday. The artificial intelligence chipmaker Nvidia reported the quarterly results during the week.
The shares of Nvidia fell sharply despite beating earnings and revenue estimates due to cautious guidance of export restrictions to China. Though Nvidia’s weakness impacted the Nasdaq, other big tech shares supported the Nasdaq index to gain around 1% during the week. Meanwhile, the Dow Jones Industrial Average (DJIA) and S&P 500 index also gained above 1% during the week.
On the economic front, the Commerce Department reported a decline in durable goods orders in October, its second-biggest drop since April 2020. On Friday, the flash PMI survey done by S&P Global showed that the business activity in the services sector has picked up the highest in four months while manufacturing activity witnessed an unexpectedly significant deceleration in November.
However, S&P Global also reported that subdued demand conditions and diminishing backlogs prompted the companies to cut jobs for the first time since 2020. The 10-year US Treasury hit an intraday low of 4.37% on Wednesday, its lowest level in over two months, but closed slightly higher at 4.471% on Friday.
European Stock Market Indexes- Weekly Updates
The pan-European Stoxx 600 index closed higher during the week, while the major indexes ended mixed. The key indexes, CAC and DAX gained while Italy’s FTSE MIB and UK’s FTSE 100 declined during the week. The indexes gained on the hopes that central banks would start reducing interest rates in the first half of 2024, as inflation rates are sharply falling.
European Central Bank officials indicated that the fight to tame inflation is not over and washout the investors’ expectations that the central bank would soon cut interest rates. ECB President Christine Lagarde and other officials said rates could be steady over “the next couple of quarters.
On the economic front, the HCOB flash PMI survey showed that eurozone business activity remained in contraction in November but slightly up from the previous month. The UK government, announced tax cuts for workers, incentives for business investment, and other measures to support housing markets in its Autumn budget.
Asian Stock Markets Updates
The major Asian stock market indexes closed higher this week in alignment with other global stock market indexes. Indian stock market indices closed higher for the fourth consecutive week. You can read about the Indian stock market’s weekly updates here.
Japan Stock Market
Japan’s Nikkei ended slightly higher during the holiday-shortened week. The market sentiments were boosted due to strong corporate earnings and on expectation that the US interest rates had peaked.
On the economic front, Japan’s PMI survey showed that private sector activity stalled in November largely due to a decline in business conditions in manufacturing activity.
Japan’s core consumer price index (CPI) inflation accelerated for the first time in four months in October, but a tick lower than the expectations. The hot CPI data above BoJ’s 2% target fueled speculation that tighter monetary policy could be implemented by the BoJ in its next policy meeting.
Chinese Stock Market
Chinese stock markets closed marginally lower during the week, as the stimulus news for property sectors was not enough to offset the concern of economic slowdown.
In its continuous effort to address the ongoing property crisis, Chinese regulators have chalked out a plan for property developers to support with financial measures and improve their balance sheets. On the monetary policy front, the People’s Bank of China (PBOC) left the one- and five-year loan prime rates unchanged, as widely expected.
In Hong Kong, the Hang Seng Index closed higher during the week.
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