Global Stock Market Update: Weekly News and Insights ( 8- 12 April)
Global Stock Market Weekly Analysis (8 – 12 April 2024)
The major global stock market indexes retreated for the week ending on April 12th. The US, European, and Asian stock market indices mostly closed in the red during the week.
The US Stock Markets – Weekly Updates
The key stock market indexes in the US ended lower for the week. Dow Jones fell sharply due to disappointing big bank earnings, geopolitical tension, and persistent inflationary pressure. The growth stocks performed better than the value shares, which were dragged down by sectors sensitive to interest rates, including real estate investment trusts (REITs), regional banks, housing, and utilities.
Wednesday’s CPI inflation is the key factor of a sharp decline in US markets. The labor department showed that retail inflation has increased hotter than expected in March. Even the core inflation also came higher. This pushed the Treasury yields higher, the 10-year US Treasury closed at 4.532% on Friday, jumped from 4.406% closing last Friday.
Traders have almost cut their hopes of June rate cuts after the red-hot inflation data and are betting for September interest rate cuts. According to the CME FedWatch tool, the chances of June rate cuts dropped from 65% last week to 20%, while the probability of a September rate cut is at 75%.
However, the producer price index (PPI) data has relieved traders on Thursday. It came to a tick below the economist’s expectation and the market sentiments improved, Nasdaq and S&P500 rose, while Dow closed flat after the report. On Friday, markets fell significantly due to disappointing quarterly results from banking giants, announcing a bleak outlook on net interest income.
The rising crude prices due to an escalation of Middle East tension also dampened the market sentiments, particularly after a report of a possible attack on Israel by Iran. This spiked the crude oil price due to concerns about supply disruption from major oil-producing countries in the region.
European Stock Market Indexes- Weekly Updates
European stock market indexes mostly closed in the red over the week, ending April 12. The pan-European Stoxx 600 index ended marginally lower, while the key indexes in the region CAC, DAX, FTSE MIB ended in the red, while the UK’s FTSE closed higher.
The market sentiments were hit mainly following negative cues from Wall Street and geopolitical tension that surged the oil prices. However, the downside was limited, as the European Central Bank has kept the interest rate unchanged and hinted at a rate cut in June.
The other economic data released in the region showed that investor confidence rose in April to its highest level in two years. Germany’s industrial production rose sequentially for the second consecutive month. The UK’s GDP growth expanded in February, consecutively for the second month.
Asian Stock Markets Updates
Asian stock market indexes mostly closed lower for the week ending April 12th. The stock market indexes of China and South Korea closed lower, while indices in India and Hong Kong ended flat. Meanwhile, Japan’s Nikkei 225 index, ended higher during the week. The negative sentiments from US markets, geopolitical tension, and weak economic data from China dented the market sentiments.
Japan Stock Market
Japan’s Nikkei 225 rebounded after closing sharply lower in the previous week. The market sentiments were improved as investors bet on last week’s beaten-down stocks. As the weakness in the yen persists against the US dollar, investors preferred the export-related stocks. Investors were hoping that government authorities would step in and support the currency. However, the upside remained capped due to a weakness in Wall Street after hotter-than-expected inflation data dented global market sentiments.
China Stock Market
China’s Shanghai index closed lower during the week, as investors worried about weak inflation data and lackluster demand in the Chinese economy. China’s consumer price index rose below market expectations in March. The producer price index inflation fell in March, compared to the same period last year but came to a tick higher from February.
On Friday, China’s trade data showed that the country’s exports and imports fell in March and reversed gains from the first two months of the year. Exports declined worse-than-expected 7.5% in March from a year ago compared with a 7.1% rise in January to February. Meanwhile, imports dropped 1.9%, down from 3.5% growth in the first two months of 2024.
In Hong Kong, the Hang Seng indexes edged lower, while South Korea’s Kospi ended the week in the red.
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