Global Stocks Rally after the Fed and Beijing Report
The Dow Jones lost 0.36% or 127.59 points. The S&P 500 dropped a slight 0.02% or 0.82 units. Meanwhile, the Nasdaq advanced by 0.70% or 102.01 points.
Technology companies helped the Nikkei to increase by 0.73% or 200.76 points. The Kospi gained 0.18%, or 5.79 points.
Chinese companies rebounded after a reassuring message from Beijing. The Hang Seng climbed by 3.3% or 841.44 points.
Stoxx 600 reached a historical high today supported by Airbus and major commodities companies.
Wall Street closed mixed with Dow Jones falling by 0.36%
Wall Street closed mixed on Wednesday. The US Fed kept the monetary policy intact in an attempt to accommodate an economy that still needs to improve substantially. However, the market did not show any clear direction.
The Dow Jones lost 0.36% or 127.59 points, to 34,930.93.
The selective S&P 500 dropped a slight 0.02% or 0.82 units to 4,400.64.
Meanwhile, the Nasdaq market composite index ended in the green, advancing by 0.70% or 102.01 points, ending at 14,762.58.
The Fed kept interest rates near 0%
Fed Chairman Jerome Powell announced that interest rates would remain near 0% despite the high inflation in the US. According to the Fed, the economy of the world’s leading power is not strong enough yet. Powell stated that the country is still a long way from registering substantial progress towards the maximum employment target.
The US central bank director also stressed the advance of the delta variant of the coronavirus. However, he pointed out that it does not pose a severe threat to the US economy.
According to Anu Gaggar from Commonwealth, the markets are applauding the Fed’s continued patience.
Around 89% of companies listed in the S&P 500 have already revealed their financial results that have exceeded expectations.
By sector, the energy sector posted its highest gain adding 0.97%. Meanwhile, telecommunications increased by 0.75% and health gained 0.38%. As for the largest losses, consumer goods essentials dropped the most, yielding 0.87%. Also, public services shed 0.69%, and real estate lost 0.63%.
Among the 30 prominent companies listed on the Dow Jones, Boeing led profits surging by 4.18%. Caterpillar added 0.73%, and Walgreens Boots Alliance increased by 0.62%. On the other hand, McDonald’s led losses yielding 1.86%. Meanwhile, Travelers shed 1.71%, and American Express declined by 1.69%.
Nikkei gains due to the Nasdaq’s advance
The Nikkei gained on Thursday thanks to a rise in technology. The Tokyo Stock Exchange benefited from the advance of the Nasdaq on Wall Street on Wednesday.
The Nikkei added 0.73% or 200.76 points to 27,782.42. Meanwhile, the broader Topix index gained 7.78 points or 0.41%, at 1,927.43.
Advantest presented good quarterly results and soared by 7.33% today. Meanwhile, Nissan Motor, the vehicle manufacturer, surged by 5.76%.
However, analysts stay cautious, given the repeated records of new daily infections of Covid-19 in Tokyo during the Olympic Games.
The precision instruments, shipping and electrical devices sectors led earnings today.
Olympus, the manufacturer of optical and imaging equipment, advanced by 1.84%. Besides, Nikon, the manufacturer of photographic equipment, closed with a rise of 0.58%.
The shipping company Mitsui OSK Lines grew by 1.61%. Meanwhile, Mitsubishi Electric increased its value by 0.7%, and Toshiba added 1.62%.
Textile giant Fast Retailing gained 0.9%. Moreover, the world’s largest car producer, Toyota Motor, enjoyed a rise of 0.53%.
The business volume in the first section amounted to 2,579 trillion yen, compared to 1,037 trillion yen the day before.
Seoul improved thanks to good corporate results
The Seoul Stock Exchange advanced thanks to the good financial results for the second quarter, presented by some of the main companies in the world.
The Kospi gained 0.18%, or 5.79 points, to 3,242.65. Meanwhile, the Kosdaq technology index rose by 0.82% or 8.45 points to 1,044.13.
Samsung Electronics presented a balance sheet beating its historical record for the second quarter.
Thus, the main values of the Kospi closed in mixed territory today.
Samsung Electronics fell by 0.25%, while the world’s second-largest memory chipmaker SK Hynix, closed flat.
In the biopharmaceutical sector, Samsung Biologics climbed by 0.55%. Its competitor Celltrion also closed unchanged.
Naver lost 0.74% while Kakao, the most popular national messaging application operator, enjoyed a 3.4% rise.
Hyundai Motor, the main car manufacturer in the country, declined by 0.22%.
Beijing seems to loosen up
The Chinese authorities clarified this morning that they would continue to allow companies to be listed on Wall Street. This is as long as they comply with the relevant regulation. In addition, there have been leaks that from now on, Chinese regulators will assess the impact on financial markets before introducing new policies and regulations.
Analysts state that the communist government has not sat down well with the collapse of the country’s stock markets in recent days. There is a massive flight of foreign capital from these markets. So, they are trying to calm investors. It seems that the strategy is working as today the main Chinese and Hong Kong stock indices are trying to recover.
The Hang Seng climbed by 3.3% or 841.44 points to 26,315.32. Meanwhile, the Hang Seng China Enterprises advanced by 3.8%.
Chinese technology companies have rebounded strongly. Alibaba added 7.7%, Meituan hiked by 9.49%, and Tencent surged by 10.02%. However, all of them were far from the spectacular rise of Alibaba’s health services subsidiary, Ali Health which soared by 22.67%.
The lens producer Sunny Optical added 8.85%, and as for the automakers, BYD surged by 9.48%, and Geely gained 7.58%.
European stocks hit historical highs
European stocks hit all-time highs on Thursday. Strong returns from major commodities companies and Airbus supported the markets. At the same time, concerns over China’s regulatory measures were dissipating.
The pan-European STOXX 600 Index advanced by 0.3% to a record high of 463.0 points in early trading.
The world’s largest aircraft manufacturer, Airbus, gained 3.6% and provided the biggest boost to the STOXX 600.
France’s TotalEnergies and Britain’s Royal Dutch Shell added around 2% each after announcing share buybacks. Consequently, a steep rise in oil and gas prices boosted their profits.
Finnish telecommunications equipment maker Nokia was trading with a rise of 6.6%. In fact, the company benefited from a sharp turnaround in its business.
Moreover, food giant Nestlé and brewer Anheuser-Busch InBev slumped after publishing their results.
Swiss bank Credit Suisse lost 4.8% after reporting a decline of almost 80% in its second-quarter profit. The reduction resulted from the consequences of the Archegos bankruptcy.
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