- Bridgette Randall
- 09 Jan, 2025
- London
European markets traded down in thin volume as investors debated future rate paths amid rising bond yields.
Benchmark indexes in Frankfurt, Paris, Milan, and London struggled to stay above the flatline as investors debated the outlook of exports from the currency union in the future.
The European Union goods exported to the U.S. are likely to face higher tariffs, which could lower volume in the months ahead, adding to a list of worries in the region.
Bond yields in the eurozone advanced to fifteen-year highs, matching the rates seen seven months ago, following the surge in yield in the U.S. Treasury notes.
Germany's Trade Surplus Edged Lower In November
Germany's exports and imports declined in November, resulting in a decline in an annual trade surplus, according to the latest data released by the Federal Statistical Office, or Destatis.
Exports fell 3.5% from a year ago to €127.3 billion, and imports declined 2.9% to €107.9 billion, resulting in a decline in trade surplus of 6.6% to €19.7 billion from €21.1 billion a year ago.
On a monthly basis, exports increased for the first time in three months, and most German goods reached the U.S., China, and the U.K.
Exports to the U.S. increased 14.5% from the previous month to €14.0 billion, to China decreased by 4.2% to €6.6 billion, and to the UK rose by 8.6% to €7.2 billion.
Most imports to Germany arrived from China, the U.S., and the U.K., as the largest economy in the eurozone imported fewer commodities and intermediate goods.
Imports from China declined 3.1% from the previous month to €13.4 billion, from the U.S. fell by 3.7% to €7.2 billion, and from the U.K. fell by 4.7% to €2.8 billion.
Calendar and seasonally adjusted goods worth €67.8 billion were exported to the member states of the European Union, and €55.0 billion were imported from the region.
Germany's Industrial Output Lacked Momentum in November
Germany's industrial output advanced from the previous month but fell from the previous year in November, according to a report released by Destatis.
Calendar adjusted Industrial output, after adjusting for inflation, which includes manufacturing, energy, and construction, advanced 1.5% from October but fell 2.8% from a year ago.
Industrial production, which excludes energy and construction, increased 1% from the previous month but fell 3.2% from a year ago.
Energy production advanced 1.5% from the previous month but declined 0.4% from a year ago.
Eurozone Retail Sales Struggled to Advance in November
Retail sales in the Euro Area rose less than expected in November amid elevated interest rates and high cost of living.
Retail sales volume rose 0.1% on a monthly basis in November after a 0.3% decline in the previous month, Eurostat reported Thursday.
Automotive fuel sales rose 0.8% compared to a decline of 0.4%; food, drinks, and tobacco sales edged up 0.1% from 0.2%, but non-food sales edged down 0.6%, matching the rate in the previous month, respectively.
Among the largest economies in the region, retail sales increased 0.3% in France but fell 0.6% in Germany and Spain.
The annual increase in retail sales slowed to 1.2% from 2.1% in October.
Europe Indexes and Yields
The DAX index decreased by 0.2% to 20,294.40; the CAC-40 index rose by 0.2% to 7,464.24; and the FTSE 100 index inched higher by 0.6% to 8,304.35.
The yield on 10-year German bonds edged higher to 2.52%, French bonds rose to 3.38%, the UK gilts increased to 4.83%, and Italian bonds rose to 3.70%.
The euro edged lower to $1.03; the British pound inched lower to $1.228; and the U.S. dollar eased to 91.18 Swiss cents.
Brent crude decreased $0.08 to $76.07 a barrel, and the Dutch TTF natural gas fell by €0.36 to €44.73 per MWh.
Europe Stock Movers
Tesco PLC declined 1.8% to 363.56 pence despite the grocery retailer reporting strong sales growth in the holiday period.
Marks & Spencer Group Plc plunged 7.4% to 363.56 pence after the retailer reported higher-than-expected holiday period sales, but the company's warnings about costs and headwinds in the months ahead dragged the stock down.
Group sales in the quarter ending on December 28 increased 5.6% to £4.06 billion, driven by an 8.7% increase in food sales to £2.6 billion and a 1% rise in apparel, home, and beauty sales to £1.3 billion.
UK and Ireland sales advanced 5.9% to £3.9 billion, and international sales dropped 2.8% to £178 million.
B&M Value Retail SA dropped 10.5% to 307.38 pence after the discount retailer lowered its annual earnings outlook.
The variety store tightened its adjusted operating earnings outlook range to between £620 million and £650 million from the previous range between £620 million and £660 million.
Sales in the fiscal third quarter from a year ago increased 2.8% to £1.4 billion in the U.K. and 12.5% to £164 million in France.
- Akira Ito
- 09 Jan, 2025
- Tokyo
Stock market indexes in Tokyo edged lower in a choppy session, and investors reviewed the latest update on wages.
The Nikkei 225 stock average fell 1%, and the broader TOPIX fell 1.2% amid rate path uncertainties.
Japan's real wages, adjusted for inflation, declined 0.3% from a year ago, the Ministry of Health, Labour, and Welfare reported Thursday.
Nominal cash earnings rose 3% from a year ago in November, but the real wages declined for the fourth month in a row, a key indicator of consumers' purchasing power.
The average total cash earnings, or nominal wages including base and overtime pay, increased 3.0% to 305,832 yen, or $1,900, and rose for the 35th month in a row.
Meanwhile, consumer prices used to calculate wages rose at a faster pace of 3.4% in November, compared to 2.6% in the previous month.
Excluding bonuses and nonscheduled payments, average wages advanced 2.7% to 265,082 yen, the largest increase in 32 years, the report showed.
The latest household earnings data supports the case for the Bank of Japan to wait a little longer before increasing its benchmark interest rate.
The Japanese yen weakened to 158.10 against the U.S. dollar, as the Bank of Japan is less likely to raise rates at its next two-day policy meeting ending on January 24.
Japan Stock Movers
The Nikkei 225 Stock Average declined 1% to 39,605.09, and the broader TOPIX index fell 1.2% to 2,735.92.
Technology and automobile makers led decliners in active trading in Tokyo.
Advantest Corp. decreased 3.7% to €59.70, and Tokyo Electron declined 1.8% to ¥27,035.0; Lasertec Corp. fell 5.3% to ¥15,505.0.
Nissan Motor Co. Ltd. dropped 3.6% to ¥450.40, Honda Motor Co. Ltd. fell 2.6% to ¥1,553.50, and Toyota Motor Co. Ltd. declined 2.2% to ¥3,005.0.
Seven & I Holdings Co. Ltd. eased 1% to ¥2,374.50, Isetan Mitsukoshi Ltd. decreased 1.8% to ¥2,539.50, Takashimaya Co. Ltd. rose 0.7% to ¥1,236.50, and Fast Retailing Co. Ltd. advanced 0.6% to ¥52,100.0.
- Akira Ito
- 09 Jan, 2025
- Tokyo
Stock market indexes in Tokyo edged lower in a choppy session, and investors reviewed the latest update on wages.
The Nikkei 225 stock average fell 1%, and the broader TOPIX fell 1.2% amid rate path uncertainties.
Japan's real wages, adjusted for inflation, declined 0.3% from a year ago, the Ministry of Health, Labour, and Welfare reported Thursday.
Nominal cash earnings rose 3% from a year ago in November, but the real wages declined for the fourth month in a row, a key indicator of consumers' purchasing power.
The average total cash earnings, or nominal wages including base and overtime pay, increased 3.0% to 305,832 yen, or $1,900, and rose for the 35th month in a row.
Meanwhile, consumer prices used to calculate wages rose at a faster pace of 3.4% in November, compared to 2.6% in the previous month.
Excluding bonuses and nonscheduled payments, average wages advanced 2.7% to 265,082 yen, the largest increase in 32 years, the report showed.
The latest household earnings data supports the case for the Bank of Japan to wait a little longer before increasing its benchmark interest rate.
The Japanese yen weakened to 158.10 against the U.S. dollar, as the Bank of Japan is less likely to raise rates at its next two-day policy meeting ending on January 24.
Japan Stock Movers
The Nikkei 225 Stock Average declined 1% to 39,605.09, and the broader TOPIX index fell 1.2% to 2,735.92.
Technology and automobile makers led decliners in active trading in Tokyo.
Advantest Corp. decreased 3.7% to €59.70, and Tokyo Electron declined 1.8% to ¥27,035.0; Lasertec Corp. fell 5.3% to ¥15,505.0.
Nissan Motor Co. Ltd. dropped 3.6% to ¥450.40, Honda Motor Co. Ltd. fell 2.6% to ¥1,553.50, and Toyota Motor Co. Ltd. declined 2.2% to ¥3,005.0.
Seven & I Holdings Co. Ltd. eased 1% to ¥2,374.50, Isetan Mitsukoshi Ltd. decreased 1.8% to ¥2,539.50, Takashimaya Co. Ltd. rose 0.7% to ¥1,236.50, and Fast Retailing Co. Ltd. advanced 0.6% to ¥52,100.0.
- Li Chen
- 09 Jan, 2025
- Hong Kong
Stock market indexes in China and Hong Kong bounced around six-month lows amid persistent deflation worries and a lack of development in implementing the previously announced fiscal stimulus measures.
The Hang Seng index edged up 0.1%, and the mainland-focused CSI 300 index increased a fraction as investors remained cautious ahead of the start of the earnings season.
China continues to battle deflationary conditions despite the central bank's supportive monetary policy and fiscal measures announced by policymakers.
The latest inflation reports released by the National Bureau of Statistics confirmed stable economic conditions, but the lack of consumer demand growth underscored weak price momentum.
The annual consumer price inflation slowed for the fourth month in a row to 0.1% in December and fell to the level last seen in March.
Consumer prices rose 0.2% for 2024, matching the rate in 2023.
Producer price inflation in December fell 2.3%, a smaller decline than 2.5% in the previous month, and prices fell for the 27th month in a row.
For the full year, producer prices contracted 2.2% in 2024.
China Stock Movers
The Hang Seng index increased 0.1% to 19,289.38, and the mainland-focused CSI 300 index gained 0.1% to 3,793.06.
Tencent Holdings Ltd. increased 1.4% to HK $374.60 after the third-largest Hong Kong-listed company stepped up its stock repurchase.
The parent company of WeChat acquired HK$3.7 billion of its own stock in the previous week following a decline of more than 15% over the last two weeks, according to filings with the exchange.
Two newly listed companies began trading on the Hong Kong Stock Exchange, increasing the list of 2025's initial public offerings to three.
ContiOcean Environment Tech edged up 4% to HK$33.45 after the maritime technology company sold 10 million shares at HK$31.80 per share.
The company's HK$318 million initial public offering was oversubscribed 54 times, but foreign investor participation was less than expected.
Anhui Conch Material Technology dropped more than 43% to HK$1,640 after the company priced its initial public offering.
Fine chemical materials supplier priced a 145 million share offering at HK $3.0 per share, and the public issue was oversubscribed by 25 times.
- Li Chen
- 09 Jan, 2025
- Hong Kong
Stock market indexes in China and Hong Kong bounced around six-month lows amid persistent deflation worries and a lack of development in implementing the previously announced fiscal stimulus measures.
The Hang Seng index edged up 0.1%, and the mainland-focused CSI 300 index increased a fraction as investors remained cautious ahead of the start of the earnings season.
China continues to battle deflationary conditions despite the central bank's supportive monetary policy and fiscal measures announced by policymakers.
The latest inflation reports released by the National Bureau of Statistics confirmed stable economic conditions, but the lack of consumer demand growth underscored weak price momentum.
The annual consumer price inflation slowed for the fourth month in a row to 0.1% in December and fell to the level last seen in March.
Consumer prices rose 0.2% for 2024, matching the rate in 2023.
Producer price inflation in December fell 2.3%, a smaller decline than 2.5% in the previous month, and prices fell for the 27th month in a row.
For the full year, producer prices contracted 2.2% in 2024.
China Stock Movers
The Hang Seng index increased 0.1% to 19,289.38, and the mainland-focused CSI 300 index gained 0.1% to 3,793.06.
Tencent Holdings Ltd. increased 1.4% to HK $374.60 after the third-largest Hong Kong-listed company stepped up its stock repurchase.
The parent company of WeChat acquired HK$3.7 billion of its own stock in the previous week following a decline of more than 15% over the last two weeks, according to filings with the exchange.
Two newly listed companies began trading on the Hong Kong Stock Exchange, increasing the list of 2025's initial public offerings to three.
ContiOcean Environment Tech edged up 4% to HK$33.45 after the maritime technology company sold 10 million shares at HK$31.80 per share.
The company's HK$318 million initial public offering was oversubscribed 54 times, but foreign investor participation was less than expected.
Anhui Conch Material Technology dropped more than 43% to HK$1,640 after the company priced its initial public offering.
Fine chemical materials supplier priced a 145 million share offering at HK $3.0 per share, and the public issue was oversubscribed by 25 times.
- Arun Goswami
- 09 Jan, 2025
- Mumbai
In cautious trading, stock market indexes traded down ahead of the start of the earnings season amid lowered earnings growth expectations.
The Sensex index decreased by 0.3% to 77,914.36, and the Nifty index fell by 0.3% to 77,897.91.
On the Mumbai stock exchange, 46 stocks traded at their 52-week highs, and 25 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched lower to 6.78%, and the Indian rupee traded around a record low of 85.91 against the U.S. dollar.
Tata Motors declined 2% to ₹780.0 after the vehicle maker reported lackluster delivery results in the December quarter.
Wholesale vehicle delivery increased 3% to 104,427 units from the previous quarter and rose 20% from the previous quarter.
P N Gadgil Jewellers advanced 1.2% to ₹681.05, and the company reported total retail sales jumped 42% from a year ago in the December quarter.
Franchise segment sales advanced 87%, and online sales surged 98%.
Nuvoco Vistas Corp. Ltd. declined 0.3% to ₹353.95, and the company plans to acquire Vadraj Cement, through the insolvency process, for as much as ₹3,000 crore.
Manappuram Finance jumped 4.5% to ₹188.10 after the Reserve Bank of India lifted restrictions on the company's microfinance subsidiary following the improvement in compliance.
- Arun Goswami
- 09 Jan, 2025
- Mumbai
In cautious trading, stock market indexes traded down ahead of the start of the earnings season amid lowered earnings growth expectations.
The Sensex index decreased by 0.3% to 77,914.36, and the Nifty index fell by 0.3% to 77,897.91.
On the Mumbai stock exchange, 46 stocks traded at their 52-week highs, and 25 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched lower to 6.78%, and the Indian rupee traded around a record low of 85.91 against the U.S. dollar.
Tata Motors declined 2% to ₹780.0 after the vehicle maker reported lackluster delivery results in the December quarter.
Wholesale vehicle delivery increased 3% to 104,427 units from the previous quarter and rose 20% from the previous quarter.
P N Gadgil Jewellers advanced 1.2% to ₹681.05, and the company reported total retail sales jumped 42% from a year ago in the December quarter.
Franchise segment sales advanced 87%, and online sales surged 98%.
Nuvoco Vistas Corp. Ltd. declined 0.3% to ₹353.95, and the company plans to acquire Vadraj Cement, through the insolvency process, for as much as ₹3,000 crore.
Manappuram Finance jumped 4.5% to ₹188.10 after the Reserve Bank of India lifted restrictions on the company's microfinance subsidiary following the improvement in compliance.
- Alexander Garcia
- 08 Jan, 2025
- Miami
Wall Street indexes lacked direction a day after falling sharply amid renewed worries about the resurgent inflation and growing possibilities of fewer rate cuts.
The S&P 500 index and the Nasdaq Composite advanced 0.1% as investors dialed down expectations for additional rate cuts.
Market sentiment soured after the ISM Services PMI showed the continued expansion in business activities, but participants sharply raised inflation expectations in the months ahead.
Despite the Fed's insistence that interest rate policies are restrictive, prices are still rising at nearly a 4% annual rate in the service sector, significantly higher than the target rate of 2%.
Moreover, higher tariffs on imported goods are going to fuel inflationary forces, which could force the Fed to pivot to raising rates from its current plan to cut rates by as much as 100 basis points in the new year.
Benchmark indexes are likely to stay under pressure ahead of Friday's non-farm payrolls report.
The private sector added 122,000 jobs in December, the slowest pace of increase in four months, according to the latest estimate released by ADP.
ADP employment is highly unreliable, and the estimates are subject to sharp revisions in the months ahead.
Initial jobless claims declined 10,000 to 201,000 in the week ending on Jan 4, the U.S. Department of Labor reported Wednesday.
Stock markets are closed for trading on Thursday in honor of the late U.S. President, Jimmy Carter.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.1% to 5,914.73, the Nasdaq Composite rose 0.1% to 19,496.92, and the Russell 2000 index inched down by 0.8% to 2,232.04.
The yield on 2-year Treasury notes edged higher to 4.29%, 10-year Treasury notes inched up to 4.71%, and 30-year Treasury bonds increased to 4.96%.
WTI crude oil increased $0.60 to $74.85 a barrel, and natural gas prices edged up 13 cents to $3.55 a thermal unit.
Gold increased by $19.86 to $2,669.82 an ounce, and silver rose by $0.12 to $30.21.
The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.35 to 109.03 and traded at a two-year high.
U.S. Stock Movers
Cal-Maine Foods increased 4.8% to $108.60 after the egg-producing company reported its latest quarterly results.
Revenue in the quarter ending on November 30 increased 82% to $954.7 million from $523.3 million, net income advanced to $218.3 million from $16.6 million, and diluted earnings per share jumped to $4.47 from 35 cents a year ago.
AAR Corp. jumped 4.5% to $64.50 after the aviation company reported better-than-expected fiscal second quarter results.
Revenue in the fiscal second quarter ending in November increased 26% to $686 million, net income swung to a loss of $30.6 million from a profit of $23.8 million, and diluted earnings per share were a loss of 87 cents compared to an income of 67 cents a year ago.
European Bond Yields Edged Higher
European stock market indexes advanced despite worries about interest rates and the threat of potential U.S. tariffs.
Benchmark indexes in Paris, Frankfurt, Milan, and London advanced, and bond yields edged higher, tracking the yields on the U.S. Treasury notes.
The euro hovered near a two-year low ahead of the release of Friday's U.S. nonfarm payrolls report, which could support the Fed's view of fewer and slower rate cuts in 2025.
On the economic front, Germany's factory orders unexpectedly declined and retail sales fell, and the Euro Area producer prices rose at the fastest pace since 2022.
Germany's Factory Orders Dropped In November
Germany's factory orders for manufactured goods declined 5.4% from the previous month and fell 1.7% from a year ago in November, the Federal Statistics Office, or Destatis, reported Wednesday.
The main reason for the decline in orders was the 58.4% plunge from the previous month in large orders, which generally includes aircraft, trains, and ships.
However, excluding large orders, incoming orders were 0.2% higher than in the previous month.
Domestic orders rose by 3.8% compared to the previous month, and foreign orders fell by 10.8%. Orders from the eurozone fell by 3.8%, and from outside the eurozone dropped by 14.8%.
In the less volatile three-month comparison, incoming orders between September and November 2024 were 1.7% higher overall and, excluding large orders, 0.5% higher than in the previous three months.
Germany's Retail Sales Highlight Struggling Consumer
Retail sales in Germany in November highlighted lackluster consumer demand amid the cost of living crisis and elevated inflation.
Nominal retail sales, not adjusted for seasonal factors and inflation, decreased 0.6% from the previous month but rose 3.5% from a year ago, the statistical office reported Wednesday.
Nominal sales in the food retail sector increased 0.2% from the previous month and rose 3.8% from a year ago.
Nominal sales in the non-food retail sector rose 2.5% from a year ago and decreased 1.7% from the previous month.
Monthly Eurozone Producer Prices Accelerated In November
Producer prices in the Euro Area accelerated for the second month in a row in November due to a sustained rise in energy costs.
Producer prices jumped 1.6% from the previous month in November, following a 0.4% increase in October, Eurostat reported Wednesday.
On an annual basis, producer prices declined 1.2% after falling 3.3% in October.
Across the largest four economies in the currency bloc, producer prices increased 3.2% in France, 2.7% in Spain, 1.8% in Italy, and 0.6% in Germany.
Europe Indexes and Yields
The DAX index decreased by 0.1% to 20,316.72; the CAC-40 index fell by 0.5% to 7,452.82; and the FTSE 100 index inched higher by 0.01% to 8,251.03.
The yield on 10-year German bonds edged higher to 2.49%, French bonds rose to 3.31%, the UK gilts increased to 4.71%, and Italian bonds rose to 3.62%.
The euro edged lower to $1.03; the British pound inched lower to $1.246; and the U.S. dollar eased to 91.16 Swiss cents.
Brent crude decreased $0.82 to $76.22 a barrel, and the Dutch TTF natural gas fell by €2.51 to €45.42 per MWh.
Europe Stock Movers
TeamViewer SE soared 10.5% to €10.58 after the remote computer access and control company reported higher-than-expected full-year revenue.
Flutter Entertainment SE decreased 2.5% to 20,010.0 pence after the online gambling company lowered its U.S. revenue and profit outlook for 2024.
Shell PLC declined 1.8% to 2,570.50 pence after the UK-based energy company trimmed its LNG production outlook for the fourth quarter.
Pluxee NV soared 12.6% to €21.16 after the employee benefit company reported better-than-expected fiscal first quarter total revenue.
Total revenue in the fiscal first quarter increased 13.2% to €289 million, and the company reiterated its annual outlook.
Nikkei 225 and TOPIX Under Pressure After U.S. Treasury Yields Surge
Benchmark indexes in Tokyo traded down amid interest rate path worries and volatile tech stocks.
The Nikkei 225 stock average declined 0.2%, and the broader TOPIX index decreased 0.5%, but they managed to recover from the worst levels of the session.
Market sentiment was weak in Tokyo after the yield on the 10-year U.S. Treasury note rose to a seven-month high of 4.69%, following the release of December's service sector activities survey.
The service sector continued to expand for the tenth month in a row in December, but inflation expectations rose sharply ahead of the possible tariffs on imported goods by the president-elect Trump's administration as early as this month.
Benchmark indexes accelerated decline in the early hours of trading, mirroring a sharp sell-off in tech stocks in overnight trading in New York fueled by persistent inflation worries.
Investors lowered expectations for additional rate cuts in the imminent future after the release of the service index update.
Closer to home, investors are looking forward to the release of household spending and earnings data later in the week.
Japan Stock Movers
The Nikkei 225 Stock Average decreased 0.2% to 39,991.85, and the broader TOPIX index fell 0.5% to 2,771.61.
Semiconductor-related stocks rebounded from morning losses in Tokyo, mirroring declines on Wall Street in overnight trading.
Tokyo Electron Ltd. increased 1.5% to ¥27,520.0, Advantest Corp. gained 3.5% to ¥10,080.0, and Disco Corp. gained 4.6% to ¥48,570.0.
Honda Motor Corp. declined 0.4% to ¥1,599.50, Nissan Motor Corp. fell 2.5% to ¥466.80, and Toyota Motor Corp. added 0.9% to ¥3,080.0.
Tokio Marine Holdings dropped 4.5% to ¥5,481.0, Dai Ichi Life Holdings fell 3.4% to ¥4,275.0, and SOMPO Holdings eased 3.3% to ¥4,011.0.
China and Hong Kong Indexes Extend Losses Amid Fading Stimulus Rally
Stock market indexes in China and Hong Kong declined amid geopolitical tensions and a weak corporate earnings outlook.
The Hang Seng index dropped 1%, and the mainland-focused CSI 300 index decreased 0.7%, as investors reacted to the sharp decline in Wall Street indexes in overnight trading.
The Hang Seng index extended losses for the third week in a row and wiped out most of the gains in the final quarter of 2024 after policymakers announced a raft of stimulus measures.
However, market enthusiasm has waned in the last five weeks of trading as policymakers failed to follow through with specific stimulus implementation steps.
The Hang Seng has dropped more than 15% from the peak of 23,077 reached on October 7, and traders are bracing for the index to test 17,249, the level before the stimulus announcements.
Moreover, market sentiment was dented after the U.S. service sector continued to grow for the tenth month in a row in December, but inflation expectations also rose amid potential tariffs on imported goods.
The latest service sector strength and inflation expectations confirmed that the Federal Reserve may not need to lower rates in the imminent future, keeping interest rates higher for longer.
On the domestic economic front, investors looked ahead to the release of producer price and consumer price inflation data later in the week, and both measures of inflation are expected to show the continuation of the deflation trend.
China Stock Movers
The Hang Seng index declined 1% to 19,239.70, and the mainland-focused CSI 300 index fell 0.7% to 3,768.35.
Technology stocks declined for the second consecutive session after the U.S. expanded its list of Chinese companies deemed as military entities.
Tencent Holdings Ltd. decreased 2.3% to HK $370.80, Baidu Inc. declined 1% to HK $79.60, and Alibaba Group Holding Ltd. fell 0.3% to HK $81.10.
BrainAurora Medical Technology was nearly unchanged at HK $3.25 after the company completed its HK $500 million public offering.
Hong Kong's first public offering in 2025 sold 181 million shares priced at HK $3.22 per share.
- Alexander Garcia
- 08 Jan, 2025
- Miami
Wall Street indexes lacked direction a day after falling sharply amid renewed worries about the resurgent inflation and growing possibilities of fewer rate cuts.
The S&P 500 index and the Nasdaq Composite advanced 0.1% as investors dialed down expectations for additional rate cuts.
Market sentiment soured after the ISM Services PMI showed the continued expansion in business activities, but participants sharply raised inflation expectations in the months ahead.
Despite the Fed's insistence that interest rate policies are restrictive, prices are still rising at nearly a 4% annual rate in the service sector, significantly higher than the target rate of 2%.
Moreover, higher tariffs on imported goods are going to fuel inflationary forces, which could force the Fed to pivot to raising rates from its current plan to cut rates by as much as 100 basis points in the new year.
Benchmark indexes are likely to stay under pressure ahead of Friday's non-farm payrolls report.
The private sector added 122,000 jobs in December, the slowest pace of increase in four months, according to the latest estimate released by ADP.
ADP employment is highly unreliable, and the estimates are subject to sharp revisions in the months ahead.
Initial jobless claims declined 10,000 to 201,000 in the week ending on Jan 4, the U.S. Department of Labor reported Wednesday.
Stock markets are closed for trading on Thursday in honor of the late U.S. President, Jimmy Carter.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.1% to 5,914.73, the Nasdaq Composite rose 0.1% to 19,496.92, and the Russell 2000 index inched down by 0.8% to 2,232.04.
The yield on 2-year Treasury notes edged higher to 4.29%, 10-year Treasury notes inched up to 4.71%, and 30-year Treasury bonds increased to 4.96%.
WTI crude oil increased $0.60 to $74.85 a barrel, and natural gas prices edged up 13 cents to $3.55 a thermal unit.
Gold increased by $19.86 to $2,669.82 an ounce, and silver rose by $0.12 to $30.21.
The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.35 to 109.03 and traded at a two-year high.
U.S. Stock Movers
Cal-Maine Foods increased 4.8% to $108.60 after the egg-producing company reported its latest quarterly results.
Revenue in the quarter ending on November 30 increased 82% to $954.7 million from $523.3 million, net income advanced to $218.3 million from $16.6 million, and diluted earnings per share jumped to $4.47 from 35 cents a year ago.
AAR Corp. jumped 4.5% to $64.50 after the aviation company reported better-than-expected fiscal second quarter results.
Revenue in the fiscal second quarter ending in November increased 26% to $686 million, net income swung to a loss of $30.6 million from a profit of $23.8 million, and diluted earnings per share were a loss of 87 cents compared to an income of 67 cents a year ago.
European Bond Yields Edged Higher
European stock market indexes advanced despite worries about interest rates and the threat of potential U.S. tariffs.
Benchmark indexes in Paris, Frankfurt, Milan, and London advanced, and bond yields edged higher, tracking the yields on the U.S. Treasury notes.
The euro hovered near a two-year low ahead of the release of Friday's U.S. nonfarm payrolls report, which could support the Fed's view of fewer and slower rate cuts in 2025.
On the economic front, Germany's factory orders unexpectedly declined and retail sales fell, and the Euro Area producer prices rose at the fastest pace since 2022.
Germany's Factory Orders Dropped In November
Germany's factory orders for manufactured goods declined 5.4% from the previous month and fell 1.7% from a year ago in November, the Federal Statistics Office, or Destatis, reported Wednesday.
The main reason for the decline in orders was the 58.4% plunge from the previous month in large orders, which generally includes aircraft, trains, and ships.
However, excluding large orders, incoming orders were 0.2% higher than in the previous month.
Domestic orders rose by 3.8% compared to the previous month, and foreign orders fell by 10.8%. Orders from the eurozone fell by 3.8%, and from outside the eurozone dropped by 14.8%.
In the less volatile three-month comparison, incoming orders between September and November 2024 were 1.7% higher overall and, excluding large orders, 0.5% higher than in the previous three months.
Germany's Retail Sales Highlight Struggling Consumer
Retail sales in Germany in November highlighted lackluster consumer demand amid the cost of living crisis and elevated inflation.
Nominal retail sales, not adjusted for seasonal factors and inflation, decreased 0.6% from the previous month but rose 3.5% from a year ago, the statistical office reported Wednesday.
Nominal sales in the food retail sector increased 0.2% from the previous month and rose 3.8% from a year ago.
Nominal sales in the non-food retail sector rose 2.5% from a year ago and decreased 1.7% from the previous month.
Monthly Eurozone Producer Prices Accelerated In November
Producer prices in the Euro Area accelerated for the second month in a row in November due to a sustained rise in energy costs.
Producer prices jumped 1.6% from the previous month in November, following a 0.4% increase in October, Eurostat reported Wednesday.
On an annual basis, producer prices declined 1.2% after falling 3.3% in October.
Across the largest four economies in the currency bloc, producer prices increased 3.2% in France, 2.7% in Spain, 1.8% in Italy, and 0.6% in Germany.
Europe Indexes and Yields
The DAX index decreased by 0.1% to 20,316.72; the CAC-40 index fell by 0.5% to 7,452.82; and the FTSE 100 index inched higher by 0.01% to 8,251.03.
The yield on 10-year German bonds edged higher to 2.49%, French bonds rose to 3.31%, the UK gilts increased to 4.71%, and Italian bonds rose to 3.62%.
The euro edged lower to $1.03; the British pound inched lower to $1.246; and the U.S. dollar eased to 91.16 Swiss cents.
Brent crude decreased $0.82 to $76.22 a barrel, and the Dutch TTF natural gas fell by €2.51 to €45.42 per MWh.
Europe Stock Movers
TeamViewer SE soared 10.5% to €10.58 after the remote computer access and control company reported higher-than-expected full-year revenue.
Flutter Entertainment SE decreased 2.5% to 20,010.0 pence after the online gambling company lowered its U.S. revenue and profit outlook for 2024.
Shell PLC declined 1.8% to 2,570.50 pence after the UK-based energy company trimmed its LNG production outlook for the fourth quarter.
Pluxee NV soared 12.6% to €21.16 after the employee benefit company reported better-than-expected fiscal first quarter total revenue.
Total revenue in the fiscal first quarter increased 13.2% to €289 million, and the company reiterated its annual outlook.
Nikkei 225 and TOPIX Under Pressure After U.S. Treasury Yields Surge
Benchmark indexes in Tokyo traded down amid interest rate path worries and volatile tech stocks.
The Nikkei 225 stock average declined 0.2%, and the broader TOPIX index decreased 0.5%, but they managed to recover from the worst levels of the session.
Market sentiment was weak in Tokyo after the yield on the 10-year U.S. Treasury note rose to a seven-month high of 4.69%, following the release of December's service sector activities survey.
The service sector continued to expand for the tenth month in a row in December, but inflation expectations rose sharply ahead of the possible tariffs on imported goods by the president-elect Trump's administration as early as this month.
Benchmark indexes accelerated decline in the early hours of trading, mirroring a sharp sell-off in tech stocks in overnight trading in New York fueled by persistent inflation worries.
Investors lowered expectations for additional rate cuts in the imminent future after the release of the service index update.
Closer to home, investors are looking forward to the release of household spending and earnings data later in the week.
Japan Stock Movers
The Nikkei 225 Stock Average decreased 0.2% to 39,991.85, and the broader TOPIX index fell 0.5% to 2,771.61.
Semiconductor-related stocks rebounded from morning losses in Tokyo, mirroring declines on Wall Street in overnight trading.
Tokyo Electron Ltd. increased 1.5% to ¥27,520.0, Advantest Corp. gained 3.5% to ¥10,080.0, and Disco Corp. gained 4.6% to ¥48,570.0.
Honda Motor Corp. declined 0.4% to ¥1,599.50, Nissan Motor Corp. fell 2.5% to ¥466.80, and Toyota Motor Corp. added 0.9% to ¥3,080.0.
Tokio Marine Holdings dropped 4.5% to ¥5,481.0, Dai Ichi Life Holdings fell 3.4% to ¥4,275.0, and SOMPO Holdings eased 3.3% to ¥4,011.0.
China and Hong Kong Indexes Extend Losses Amid Fading Stimulus Rally
Stock market indexes in China and Hong Kong declined amid geopolitical tensions and a weak corporate earnings outlook.
The Hang Seng index dropped 1%, and the mainland-focused CSI 300 index decreased 0.7%, as investors reacted to the sharp decline in Wall Street indexes in overnight trading.
The Hang Seng index extended losses for the third week in a row and wiped out most of the gains in the final quarter of 2024 after policymakers announced a raft of stimulus measures.
However, market enthusiasm has waned in the last five weeks of trading as policymakers failed to follow through with specific stimulus implementation steps.
The Hang Seng has dropped more than 15% from the peak of 23,077 reached on October 7, and traders are bracing for the index to test 17,249, the level before the stimulus announcements.
Moreover, market sentiment was dented after the U.S. service sector continued to grow for the tenth month in a row in December, but inflation expectations also rose amid potential tariffs on imported goods.
The latest service sector strength and inflation expectations confirmed that the Federal Reserve may not need to lower rates in the imminent future, keeping interest rates higher for longer.
On the domestic economic front, investors looked ahead to the release of producer price and consumer price inflation data later in the week, and both measures of inflation are expected to show the continuation of the deflation trend.
China Stock Movers
The Hang Seng index declined 1% to 19,239.70, and the mainland-focused CSI 300 index fell 0.7% to 3,768.35.
Technology stocks declined for the second consecutive session after the U.S. expanded its list of Chinese companies deemed as military entities.
Tencent Holdings Ltd. decreased 2.3% to HK $370.80, Baidu Inc. declined 1% to HK $79.60, and Alibaba Group Holding Ltd. fell 0.3% to HK $81.10.
BrainAurora Medical Technology was nearly unchanged at HK $3.25 after the company completed its HK $500 million public offering.
Hong Kong's first public offering in 2025 sold 181 million shares priced at HK $3.22 per share.
- Scott Peters
- 08 Jan, 2025
- New York City
Cal-Maine Foods increased 4.8% to $108.60 after the egg-producing company reported its latest quarterly results.
Revenue in the quarter ending on November 30 increased 82% to $954.7 million from $523.3 million, net income advanced to $218.3 million from $16.6 million, and diluted earnings per share jumped to $4.47 from 35 cents a year ago.
AAR Corp. jumped 4.5% to $64.50 after the aviation company reported better-than-expected fiscal second quarter results.
Revenue in the fiscal second quarter ending in November increased 26% to $686 million, net income swung to a loss of $30.6 million from a profit of $23.8 million, and diluted earnings per share were a loss of 87 cents compared to an income of 67 cents a year ago.
- Scott Peters
- 08 Jan, 2025
- New York City
Cal-Maine Foods increased 4.8% to $108.60 after the egg-producing company reported its latest quarterly results.
Revenue in the quarter ending on November 30 increased 82% to $954.7 million from $523.3 million, net income advanced to $218.3 million from $16.6 million, and diluted earnings per share jumped to $4.47 from 35 cents a year ago.
AAR Corp. jumped 4.5% to $64.50 after the aviation company reported better-than-expected fiscal second quarter results.
Revenue in the fiscal second quarter ending in November increased 26% to $686 million, net income swung to a loss of $30.6 million from a profit of $23.8 million, and diluted earnings per share were a loss of 87 cents compared to an income of 67 cents a year ago.