Global Stock Markets Fluctuate

Highlights:

• • USA
    For the week, the Dow Jones accumulated a gain of 0.6% in the last five days. Meanwhile, the selective S&P 500 added 0.5%, and the Nasdaq increased by 0.02%.
  • ASIA
    The Nikkei index slipped slightly, by 0.03% or 8.75 points, and ended at 30,240.06.
    The Kospi closed with an increase of 0.27% or 8.40 points to 3,133.64.
    Hang Seng settled with an increase of 0.07% or 16.62 points, to 24,208.78.
  • EUROPE
    The EuroStoxx 50 index was trading with an advance of 0.66%. The FTSEurofirst 300 added 0.45%, and the Stoxx 600 gained 0.45%.

Wall Street closed the volatile week with gains

Last week has been pretty uneasy for Wall Street. It started with a significant risk aversion because of the crisis of Chinese real estate firm Evergrande. However, the market sentiment shifted after the monthly meeting of the Federal Reserve, and the New York Stock Exchange closed Friday with gains. 

The Dow Jones accumulated a gain of 0.6% in the last five days. Meanwhile, the selective S&P 500 added 0.5%, and the Nasdaq increased by 0.02%.

Evergrande injected volatility into financial markets globally on Monday. This was due to the possibility of a suspension of payments on its debt. A Wells Fargo economists stated that the firm is very important for the Chinese real estate sector and its bankruptcy could affect global forecasts. 

Stock markets have calmed on Friday. However, fears for Evergrande, the slowing economy, and ongoing supply chain issues are still there. 

 

What do analysts expect from the quarterly earnings?

The Federal Reserve indicated after its monthly meeting last week that the bank would begin tapering by the end of 2021. As for the rising rates, it will probably begin by the end of the following year. 

Charles Schwab analysts noted that a long-term economic outlook is favorable. However, global stock markets are concerned about short-term problems now. Besides, it is clear that the Fed is moving towards tapering. Still, the pace of it is uncertain.

On the other hand, companies will soon present their quarterly results. Analysts expect it to be complicated after the data was released by Nike, one of the first companies on the calendar. The multinational clothing company delivered a worse than expected turnover. Also, it added that supply chain problems would affect the business in the next few months. 

Meanwhile, Mark Hackett, chief of investment research at Nationwide, stated that stock markets keep reflecting a push and pull between bulls and bears. The market recovery showed that the mentality of buy-the-dip persists.

Nikkei settled with a slight loss of 0.03%

The Nikkei index slipped slightly, by 0.03% or 8.75 points, and ended at 30,240.06. The number of new infections in Japan is declining, and there is an expectation that economic activity will become active due to the speed of vaccination. 

Topix index lost 0.14% or 3.01 points to 2,087.74.  

Stocks opened higher at the beginning of the trading day. In some cases, the average stock price increased by more than 100 yen. However, in the afternoon trading, sell orders gradually expanded due to concerns about the slump in the Chinese real estate market.

The trading value of the first section of the Tokyo Stock Exchange was 3,258.2 billion yen. The trading volume of the first section of the Tokyo Stock Exchange was 1,293,460,000 shares.

Among stocks with the highest capitalization, tech giant Softbank lost 0.04%. Meanwhile, Japan’s automotive leader Toyota Motor gained 2.27%. 

The rise of the airlines stood out. ANA surged by 4.2%, and Japan Airlines climbed by 3.3%. The railway operators also advanced. East Japan Railway added 3.3%, and Keisei Electric gained 1.4%. All of these companies were supported by the relaxation of anti-covid-19 measures.

The sectors that accumulated the most significant losses were maritime transport and machinery. Meanwhile, the air and road transportation sectors led in gains.

Foreigners net buying for 8 consecutive days on Kospi

The Kospi closed with an increase of 0.27% or 8.40 points to 3,133.64.

Foreigners bought a net of 340.9 billion won in the stock market, showing a buying advantage for the eighth consecutive day. Institutions also net bought 9.2 billion won, and individuals net sold 340.1 billion won. 

The Kospi started the day with little momentum. Things improved when the number of daily cases were published, which registered its record on Saturday.

Analysts mentioned that the inflow of foreign net buying turned the market upward. However, the increase narrowed in sync with the weakness in the Chinese stock market.

Kospi’s most significant asset, tech multinational Samsung Electronics, expanded by 0.52%. Meanwhile, SK Hynix, the world’s second-largest memory chip maker, posted a rise of 0.48%.

Naver, the company behind the main national internet search engine, fell by 0.62%. 

Kakao, the operator of the most popular South Korean messaging app, gained 0.42%.

 

In the biopharmaceutical sector, Samsung Biologics dropped by 0.22%, and its competitor Celltrion slipped by 2.55%.

Hyundai Motor, the largest vehicle manufacturer in South Korea, dropped by 1.45%.

 

Hang Seng wiped out gains posted in early trading

 

On Monday, the Hong Kong stock market opened slightly higher in early trading and remained volatile for a while. It rose 1.3% during the session but then began to fall to erase the gains. 

Shipping, mining, power, and other stock declines weighed on the market. Meanwhile, the Hong Kong real estate and Hong Kong banking stocks rose slightly.

At the end of the trading session, Hang Seng settled with an increase of 0.07% or 16.62 points, to 24,208.78. Meanwhile, the Hang Seng China Enterprises fell by 0.25%.

It was a good day for Chinese oil companies. Petrochina, Sinopec, and Cnooc registered advances of 1.31%, 0.52%, and 5.08%, respectively.

Few companies in the financial sector settled in the green. HSBC, China Merchants Bank, and the Hong Kong branch of the Bank of China grew by 1.51%, 1.37%, and 0.88%, respectively.

Insurers Ping and AIA also performed well, rising by 1.38% and 0.34%, respectively.

The Real Estate sub-index, which does not include Evergrande, was hit the most today. Longfor Group plunged by 3.18%.

The carmaker Geely Auto and the manufacturer of solar panels Xinyi Solar led the biggest drops of the day.

Chinese techs companies closed mixed. Tencent increased by 0.95%, Meituan gained 1.55%, while Alibaba suffered a loss of 1.66%.

 

Europe keeps bouncing

The main European stock markets started Monday’s session in positive territory, supported by the results of the German federal elections. However, the market is still attentive to the situation of the Chinese real estate giant Evergrande.

The EuroStoxx 50 index was trading with an advance of 0.66%. The FTSEurofirst 300 added 0.45%, and the Stoxx 600 gained 0.45%.

The Stoxx energy index recorded the most significant sector increase at the beginning of the session. It expanded by 1.8%.

The British aircraft group Rolls-Royce soared by 5.07%. The company was chosen to power the US Air Force’s B52 bomber fleet.

As for the losses, Plastic Omnium dropped by 2.04% after lowering its forecast for annual results.