Global Shares Mixed Amid Delta Variant Surge

Highlights

• USA
  The US consumer confidence index boosted Wall Street stocks higher than expected. The Dow Jones recovered by 0.03%; the S&P 500 and the Nasdaq reached new all-time highs.

• ASIA
• Japan’s stock market dropped due to the concerns about a surge in new coronavirus cases.
  The Kospi gained 0.3% or 10 points, to 3,296.68.
  Shanghai Composite Index climbed by 0.50% while Hang Seng Index slipped by 0.57% after weaker factory data in China.
• EUROPE
  European shares declined due to worries about coronavirus and higher inflation. Europe’s volatility index edged slightly higher.

Wall Street Settled in the Green after US Economic Data

Wall Street closed Tuesday in the green following a new batch of US economic data. The Dow Jones Industrials gained 0.03% or 9.02 points to 34,292.29. Meanwhile, the S&P 500 and the Nasdaq reached new all-time highs. 

The selective S&P 500 also advanced by 0.03% or 1.19 points, to 4,291.80, while the Nasdaq composite index rose by 0.19% or 27.83 points, to 14,528.33.

The majority of stocks were in the red. However, technology companies (0.7%) and non-essential goods (0.23%) gains were outstanding. 

On the other hand, the sectors with the biggest losses were public services sinking by 1.65% and communications yielding 0.52%.

US consumer confidence index at 16 month high

US consumer confidence, which The Conference Board prepared for June, was higher than expected. The index rose to 157.7 from 148.7 last month. The New York stock market reacted to the promising prospects for recovery with optimism.

On the other hand, the firm S&P Case-Schiller disclosed that the country’s homes prices expanded more than 14% year-on-year in April. Also, five large cities had their most significant annual increase ever recorded.

The market also welcomed two large financial institutions, Morgan Stanley and Goldman Sachs, to raise their dividend. They boosted the respective prices by 3.35% and 1.06%.

Among the thirty Dow Jones stocks, the most significant rise was recorded by Nike, growing by 2.36%. Meanwhile, Home Depot added 1.26%, and Apple increased by 1.15%.

Boeing ended up accumulating the most considerable loss, 1.75%. It happened despite the purchase of 200 737 MAX aircraft by United Airlines.

At the close of Wall Street, the yield on the 10-year Treasury bond dropped to 1.473%. On the other hand, the dollar gained ground against the euro and was trading with a change of 1.19.

Nikkei closed lower due to concerns about Covid-19

The Tokyo Stock market index dropped by 0.07% this Wednesday. 

Nikkei lost 21.08 points, to 28,791.53 integers. The broader Topix index lost 0.3% or 5.91 points, standing at 1,943.57. 

The Tokyo stock market opened higher, encouraged by gains on Wall Street the day before. Still, Investors focused on the concerns about the global increase in cases of Covid-19 caused by new variants of the coronavirus. An increase in Covid-19 cases caused by more contagious variants such as the Delta or the Delta plus could compromise vaccination campaigns. It undermined mood and brought volatility to the Japanese market.

According to Japan’s Ministry of Health, the country saw the cumulative number of new coronavirus cases.

Investors have refrained from embarking on risky operations. They are awaiting the release of economic data offering clues about the direction of future policies.

The iron and steel sector reaped significant losses for the session. Electricity and gas followed it.

Lasertec fell by 3.44%.

Softbank group added 0.25%, and the pharmaceutical company Eisai plunged by 5% and registered the biggest decline among the firms listed on the Nikkei.

Sony lost 1.68%, while Nintendo added 0.03%.

In the first section, 1,296 companies fell against 786 that profited, while 108 closed unchanged.

The trading volume amounted to 2.34 trillion yen.

Kospi advanced again after two days of losses

The Kospi index in South Korea rose again on Wednesday after two days of losses. The Kospi gained 0.3% or 10 points, to 3,296.68.

One reason for the increase was the announcement by the US vaccine manufacturer Moderna that its Covid-19 vaccine was also effective against the Delta variant.

Despite concerns about the spread of variants and possible travel restrictions, the news has limited the negative impact on the Korean stock market. 

Among the heavyweights, technology giant Samsung Electronics sank by 0.37%. SK Hynix added 2.00% while leading chemical firm LG Chem gained 1.31%.

Internet portal operator Naver advanced by 1.46%. At the same time, giant pharmaceutical firm Samsung Biologics declined by 0.59%.

Top automaker Hyundai Motor closed flat.

The Kospi index closed June with an increase of 2.9% in June, rising for the eighth consecutive month. It set a record for the most extended consecutive rise since July 2017.

The local currency closed at 1,130.15 won against the US dollar. It was a 1.65 drop from the previous session’s close.

Only seven of the nineteen significant stocks recorded weakness. Telecom stocks fell the most by 0.61%. 

Chinese shares ended mixed after weaker factory data

Chinese shares settled mixed on Wednesday. 

The benchmark Shanghai Composite Index climbed by 0.50% or 18.02 to reach 3,591.20.

The Shenzhen Component Index ended the day higher at 1.08% or 161.90 points to stand at 15,161.70 points.

Shanghai’s tech-heavy STAR 50 Index advanced by 1.67% for the day. Meanwhile, Shenzhen’s similar ChiNext Index gained 2.08% to end the day at 3,477.18 points.

Stocks related to electronic information and ship-building posted profits. At the same time, shares linked to paper-making and environmental protection experienced losses today.

China’s monthly purchasing managers index, which measures Chinese factory activity dropped to 50.9 from May’s 51.0.

Also, measures of new export orders, production, and factory gate prices decreased.

Analysts say that shipping has been disrupted at some ports in southern China because of pandemic precautions.

Hong Kong stocks ended with losses. Traders struggled to keep track of Wall Street’s new record and maintain gains posted in early trading. The Hang Seng Index slipped by 0.57% or 166.15 points, to 28,827.95.

The biggest gainer on the Hang Seng was Galaxy Entertainment Group Ltd, advancing by 4.37%. As for losses, Hengan International Group Company Ltd registered its most significant decrease, falling by 4.41%. The energy sector sank by 0.9%, while the IT sector yielded 0.82%. The financial sector declined by 0.3%, and the property sector slid by 1.02%.

European stocks slip due to coronavirus and inflation fears

European stocks fell in early trading on Wednesday, as investors were still concerned about the Covid-19 variant strain as investors weighed the prospects for economic recovery.

Major European stock markets fell. Meanwhile, the Delta variant of Covid-19 hit economically sensitive sectors.

At the moment of writing, the pan-European STOXX 600 was trading with a loss of 0.2%. Banks, energy, and mining shares were trading with a decline between 0.6% and 1.0%.

Europe’s volatility index edged slightly higher to 17.40. It has risen consistently since hitting a 16-month low of 15.14 on June 11.

Germany’s DAX fell by 0.2% as data showed the country’s unemployment rate stood at 5.9% in June, as expected.

The European benchmark is on track to post its highest percentage gain in the first half of the year since 1998. Still, concerns about inflation and the global spread of the new Delta variant have recently slowed increases.

Charalambos Pissouros, a senior market analyst at JFD Group, thinks it is unlikely that ECB officials will start considering withdrawing monetary policy support anytime soon. So, they will remain supportive of European equities.