- Barry Adams
- 30 Sep, 2024
- New York City
Stocks struggled to advance in Monday's trading, and benchmark indexes are set to close higher for the month and for the quarter.
The S&P 500 index decreased 0.2% and the Nasdaq dropped as much as 0.3% in early trading in New York as investors debated future rate paths and economic outlook.
The S&P 500 index increased 1.6% in September and jumped 5.1% in the quarter, and the Nasdaq added 2.3% and advanced 2.2%, respectively.
Two widely followed benchmark indexes advanced in previous consecutive weeks, supported by the Fed's super-sized rate cut and better-than-expected economic data indicating resilient consumer demand and moderating but strong labor market conditions.
Investor anxieties rose after port workers at 14 major ports on the East Coast and along the Gulf Coast are set to strike at midnight Monday, potentially disrupting supplies for days or weeks.
The International Longshoremen's Association said in a post that workers plan to strike at 12:01 E.T. on Tuesday, after the master contract with the U.S. Maritime Alliance expires.
U.S. Indexes and Treasury Yields
The S&P 500 index decreased 0.2% to 5,727.03, the Nasdaq Composite fell 0.2% to 18,078.59, and the Russell 2000 index rose 0.3% to 2,230.26.
The yield on 2-year Treasury notes edged higher to 3.63%, 10-year Treasury notes inched up to 3.75%, and 30-year Treasury bonds inched higher to 4.13%.
WTI crude oil decreased $0.15 to $67.99 a barrel, and natural gas prices edged down 1 cent to $2.90 a thermal unit.
Gold fell by $19.98 to $2,638.47 an ounce, and silver decreased by $0.45 to $31.16.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 100.43.
U.S. Stock Movers
AT&T edged up 0.3% to $21.95 after the company said it has agreed to sell its 70% stake in satellite TV company DirectTV Entertainment Holding LLC to a private equity firm TPG for about $7.6 billion in cash payments stretching to 2029.
AT&T will receive $1.7 billion in cash at the time of completion of the deal, $5.4 billion in payment in 2025, and $500 million in 2029.
DirectTV also said in a separate statement it has agreed to buy Sling TV and Dish TV from EchoStar through debt exchange, culminating in a combination of two satellite TV companies.
In addition, Direct TV will acquire Dish TV's video distribution business for $1 and assume a net debt of $9.75 billion.
Stellantis declined 13% to $13.96 after the parent company of Jeep and Fiat lowered its annual outlook, citing sales weakness in "most regions."
Volkswagen AG dropped 2.2% to $11.13 after the German automaker issued its second profit warning in three months, citing ongoing weakness in China.
Nio Inc. advanced 13.5% to $7.43 after the electric vehicle maker said its China-based subsidiary will receive a total of 13.3 billion yuan of investment, including 3.3 billion from a "strategic investor."
After the investment, Nio Inc.'s stake in Nio China increased to 88.3% from 92.1%.
Alibaba Group increased 4.4% to $111.93 following a surge in tech stocks in Hong Kong and mainland China in the hopes that Beijing will soon announce fiscal measures following a package of monetary stimulus by the People's Bank of China.
Other China-linked stocks traded higher after three cities in China lowered down payment requirements and eased other restrictions for residential properties.
JD.com increased 5.5% to $42.07, and Tencent Holdings fell 0.3% to $56.88.
- Inga Muller
- 30 Sep, 2024
- Frankfurt
European bond yields edged higher despite the cooling of inflation in the region.
Italy reported inflation cooled in September, after France and Spain confirmed weakening inflation last week.
The DAX index decreased by 0.5% to 19,375.28; the CAC-40 index fell by 1.6% to 7,670.23; and the FTSE 100 index declined by 0.6% to 8,273.59.
The yield on 10-year German bonds edged higher to 2.15%, French bonds inched higher to 2.95%, the UK gilts edged up to 4.0%, and Italian bonds increased to 3.48%.
Rightmove PLC decreased 613.40 pence and extended losses for the second day in a row after the company's board rejected a £6.2 billion offer from Australia-based REA Group.
Oil exploration companies were in focus after tensions in the Middle East rose and Israel carried out more targeted bombing campaigns in Beirut and accelerated its land grab in Gaza.
Shell PLC increased 0.1% to 2,426.50 pence. BP plc gained 0.6% to 390.55 pence, and TotalEnergies SE declined 1.4% to €58.35.
Automakers traded down after Volkswagen AG issued a profit warning for the second time in three months and Stellantis NV lowered its annual outlook amid weakness in sales across all regions.
Stellantis dropped 15.4% to €12.36 and extended losses to more than 60% from a high of €27 in March; Volkswagen decreased 2.5% to €94.66 and traded at a five-year low.
3i Group plc decreased 2.6% to 3,300 pence, and Shadowfall Capital reportedly took a multi-million-pound short position in the private equity venture capital firm.
China-linked luxury stocks traded down after the official survey showed persistent weakness in the manufacturing sector.
Benchmark indexes in Shanghai soared as much as 8% and in Hong Kong advanced 2.4%, and both indexes extended September gains to over 20% amid hopes of strong fiscal measures from Beijing over the next two weeks.
Kering SA decreased 2.8% to €259.50, LVMH declined 1.5% to €692.50, and Hermes International fell 1.3% to €2,204.0.
- Bridgette Randall
- 30 Sep, 2024
- London
European stock market indexes traded lower in Monday's trading, bond yields edged higher, and the euro held firm against the dollar.
Benchmark indexes in London, Paris, and Frankfurt fell as investors debated future rate paths and calls for lowering interest rates rose amid cooling inflation.
Italy reported the annual inflation rate eased in September and dropped to the lowest level in 2024, reflecting a weakening of inflation in energy and manufactured goods, according to the statistical agency, ISTAT.
Consumer price inflation slowed to 0.7% from 1.1% in August, and core inflation, which excludes volatile food and energy prices, eased to 1.8% from 1.9% in the previous month.
Investors awaited the release of the national inflation report from Germany after most German states reported weakening inflation forces in September, according to preliminary data released today.
Last week France and Spain reported a slowing of inflation, largely reflecting weaker energy prices, but core inflation held steady because of elevated service inflation.
The U.K.'s second quarter gross domestic product increase from the previous quarter was revised down to 0.5%, slower than the previously estimated rise of 0.6%.
Europe Indexes and Yields
The DAX index decreased by 0.5% to 19,375.28; the CAC-40 index fell by 1.6% to 7,670.23; and the FTSE 100 index declined by 0.6% to 8,273.59.
The yield on 10-year German bonds edged higher to 2.15%, French bonds inched higher to 2.95%, the UK gilts edged up to 4.0%, and Italian bonds increased to 3.48%.
The euro edged lower to $1.11; the British pound inched higher to $1.33; and the U.S. dollar weakened to 84.41 Swiss cents.
Brent crude decreased $0.15 to $71.40 a barrel, and the Dutch TTF natural gas fell by €0.45 to €39.09 per MWh.
Europe Stock Movers
Rightmove PLC decreased 613.40 pence and extended losses for the second day in a row after the company's board rejected a £6.2 billion offer from Australia-based REA Group.
Oil exploration companies were in focus after tensions in the Middle East rose and Israel carried out more targeted bombing campaigns in Beirut and accelerated its land grab in Gaza.
Shell PLC increased 0.1% to 2,426.50 pence. BP plc gained 0.6% to 390.55 pence, and TotalEnergies SE declined 1.4% to €58.35.
Automakers traded down after Volkswagen AG issued a profit warning for the second time in three months and Stellantis NV lowered its annual outlook amid weakness in sales across all regions.
Stellantis dropped 15.4% to €12.36 and extended losses to more than 60% from a high of €27 in March; Volkswagen decreased 2.5% to €94.66 and traded at a five-year low.
3i Group plc decreased 2.6% to 3,300 pence, and Shadowfall Capital reportedly took a multi-million-pound short position in the private equity venture capital firm.
- Akira Ito
- 30 Sep, 2024
- Tokyo
Stock market indexes in Tokyo plunged following the announcement of the new leader of the ruling Liberal Democratic Party.
The Nikkei 225 stock average and the Topix index jumped as much as 5%, and investors overlooked the latest updates on retail sales and industrial production data.
Former defense minister Shigeru Ishiba won the tightly contested leadership race by nine candidates, garnering more votes than the run-off rival Sanae Takaichi, setting the stage for the premiership of Japan.
The newly elected party leader also expressed his plan to hold a general election as early as October, and Ishiba in the past has supported more hawkish monetary policy.
"I believe it is important for the new administration to be judged by the people as soon as possible," and added, "we would like to hold a general election on October 27," Ishiba said at an LDP news conference.
The party is expected to confirm his nomination as the next prime minister at the Diet session on Tuesday.
The Japanese yen soared to 141.7 against the U.S. dollar, dampening the stock market sentiment.
On the economic front, Japan's annual retail sales growth slightly accelerated to 2.8% in August from 2.7% in July, the Ministry of Economy, Trade & Industry reported.
Retail sales increased for the 29th month in a row, supported by the increase in wages, which continue to support higher consumption of basic items.
On a monthly basis, retail sales accelerated to an increase of 0.8%, after sales rose 0.2% in July.
Japan's industrial production declined 3.3% from the previous month in August, the fifth monthly decline in 2024, the ministry said in a separate report.
From the previous year, industrial production declined 4.9%, marking the sixth decline in 2024 and reversing the 2.9% increase in July.
Japan Stock Movers
The Nikkei 225 Stock Average declined 5% to 37,826.07 and the Topix index dropped 3.6% to 2,641.68.
Tech stocks led the decliners in Tokyo, and semiconductor-related stocks were the worst hit.
Advantest Corp. fell 6.5% to ¥6,741.0, Tokyo Electron declined 8% to ¥25,290.0, and Lasertec dropped 10% to ¥23,605.0.
Seven & I Holding declined 3.2% to HK ¥2,146.50, Fast Retailing decreased 3.4% to ¥47,420.0, and Isetan Mitsukoshi plunged 10.5% to ¥2,226.0.
Toyota Motor decreased 7.6% to ¥2,542.50, Honda Motor declined 7% to ¥1,507.50, and Nissan Motor fell 6% to ¥402.50.
Marubeni declined 3% to ¥2,340.0, Itochu Corp. fell 3.3% to ¥7,678.0, Mitsui & Company decreased 2.8% to ¥3,178.0, and Mitsubishi eased 4.2% to ¥2,952.50.
Sumitomo Mitsui Financial gained 3% to ¥3,045.0, Mitsubishi UFJ Financial advanced 0.2% to ¥1,453.50, and Mizuho Financial gained 4.2% to ¥2,936.0.
- Li Chen
- 30 Sep, 2024
- Hong Kong
Stock market indexes soared in mainland China and Hong Kong as a stimulus rally extended gains to the holiday-shortened third week.
The Hang Seng index jumped 3% and the mainland-focused CSI 300 index soared more than 6%, and the two widely followed indexes extended September gains to over 20%.
Investors bid up stocks in the hopes that the latest easing of property market restrictions coupled with monetary policy stimulus and the expected fiscal measure will revive consumer confidence.
On Monday, three leading cities in China relaxed terms to acquire residential property.
Guangzhou city authorities removed all restrictions on buying multiple residential properties.
Shanghai and Shenzhen relaxed down payment requirements for first and additional home purchases and permitted non-locals to acquire residential properties, boosting demand for new homes.
Moreover, the People's Bank of China lowered its mortgage rate following the announcement last week.
Investors are hoping that policymakers will follow up with significant fiscal measures in about two weeks ahead of the policy committee meeting.
On Tuesday, financial markets in Hong Kong are closed for the National Holiday, and mainland China markets will remain closed through October 8.
Investors largely ignored the latest update on the manufacturing sector, highlighting the weakness for the fifth month in a row.
The manufacturing purchasing managers' index edged higher to 49.8 in September from 49.1 in the previous month, the National Bureau of Statistics reported on Monday.
The non-manufacturing PMI index, which includes construction and service sector activities, eased to 50.0 in September from 50.3 in the previous month, the official report showed.
The Caixin China General Manufacturing PMI decreased to 49.3 in September from 50.4 in August and fell to the lowest level since July 2023, according to the latest update reported by S&P Global.
New orders, foreign sales, and employment all contracted amid weakness in foreign and domestic orders.
Moreover, business sentiment dropped to the second-lowest on record after new orders fell to the lowest level in two years.
The government survey data differs from the private survey because the official sample is dominated by larger and state-controlled companies, while the private survey includes more smaller and private companies active in international trade.
China Stock Movers
The Hang Seng index decreased 3.3% to 21,321.97, and the CSI 300 index soared 6.2% to 3,934.08.
Property stocks soared following the easing of curbs on residential property purchases in three leading southern cities.
Longfor Group soared 17% to HK $16.04, China Vanke advanced 12.7% to HK $7.52, China Resources Land gained 4.1% to HK $29.05, and Sun Hung Kai Properties declined 0.6% to HK $86.05.
Alibaba Group jumped 9.6% to HK $112.20, JD.com advanced 10.7% to HK $168.30, and Tencent Holdings gained 4.4% to HK $455.40.
BYD gained 3.9% to HK $286.40, Li Auto soared 10.1% to HK $110.0, and Xpeng surged 15.3% to HK $54.50.
Bank of China decreased 1.9% to HK $3.66, China Merchants Bank added 1.6% to HK $38.80, and Industrial and Commercial Bank of China fell 1.7%.
- Arun Goswami
- 30 Sep, 2024
- Mumbai
Mumbai market indexes traded lower ahead of the release of core sector output data later in the day. Crude oil edged higher following elevated tensions in the Middle East.
Gold advanced for the fourth quarter in a row amid rising demand from China and general dollar weakness.
The Sensex index decreased by 0.8% to 84,911.75, and the Nifty index fell by 0.7% to 25,993.70.
On the Mumbai stock exchange, 173 stocks traded at their 52-week highs, and 35 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched higher to 6.75%, and the Indian rupee eased to 83.75 against the U.S. dollar.
The gold price increased by 0.3% to ₹75,932 per ten grams, and silver edged up by 0.2% to ₹91,560 per kilo.
Adani Enterprises increased ₹3,150.55, and the company's subsidiary plans to double its solar cell and module capacity to 10 GW from 3 GW by 2030.
Reliance Industries decreased 0.8% to ₹3,026.25, and the company received regulatory approval to transfer its entertainment-focused TV channels to Star India.
The company agreed to transfer these assets as a part of the complex three-way merger of its media assets with media streaming and other media assets controlled by the U.S.-based Walt Disney Company.
NLC India increased 0.3% to ₹290.25, and the company said it plans to increase its renewable energy capacity to 10.1 GW from 1.4 GW by 2030.
REC Limited declined 1% to ₹554.60, and the power generation company raised $500 million through the sale of bonds maturing in September 2029.
Zydus Lifesciences decreased 0.5% to ₹1,070.05, and the company received a U.S. regulatory approval to make generic Enzalutamide capsules, a prostate cancer treatment drug.
The drug has a potential U.S. market size of $870 million.
Sterling and Wilson Renewable Energy decreased 2.2% to ₹635.40, and Shapoorji Pallonji Group and Khurshed Yazdi Daruvala sold a 7.14% stake in the company for ₹1,040 crore.
- Barry Adams
- 27 Sep, 2024
- New York City
Wall Street indexes advanced in early trading on Friday after the latest inflation data pointed to steady improvement.
The S&P 500 index and the Nasdaq Composite edged up 0.2%, and both benchmark indexes are set to advance more than 1% for the week.
Market sentiment was positive after the Personal Consumption Expenditure Price Index slowed to 0.1% in August from 0.2% in July, the U.S. Bureau of Economic Analysis reported Friday.
The alternative measure of inflation, which accounts for product substitution by consumers because of higher prices, on an annual basis slowed to 2.2% from 2.5% in the previous month.
The Core PCE price index, which excludes volatile energy and food prices, edged up slightly to 2.7% after falling for four months in a row.
The alternative measure of inflation, which is keenly watched by the Fed's policymakers, is widely considered a controversial measure because it understates the inflation experienced by most urban families.
In other global economic news, China's leaders pledged to announce broad fiscal measures during an unexpected Politburo meeting chaired by Xi Jinping.
Benchmark indexes in Hong Kong and mainland China soared for the four days in a row to jump 13% and rebound more than 20% over the last two weeks of trading.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.2% to 5,763.88, the Nasdaq Composite rose 0.1% to 18,204.34, and the Russell 2000 index rose 0.7% to 2,224.82.
The yield on 2-year Treasury notes edged higher to 3.61%, 10-year Treasury notes inched up to 3.77%, and 30-year Treasury bonds inched higher to 4.10%.
WTI crude oil decreased $0.05 to $67.65 a barrel, and natural gas prices edged down 3 cents to $2.83 a thermal unit.
Gold fell by $4.13 to $2,668.17 an ounce, and silver decreased by $0.25 to $32.22.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 100.77.
U.S. Stock Movers
Costco Wholesale declined 2.7% to $876.83 after the wholesale retailer reported weaker-than-expected quarterly results.
Revenue in the fiscal fourth quarter ending on September 1 increased 1% to $78.2 billion from $77.4 billion, net income advanced to $2.35 billion from $2.16 billion, and diluted earnings per share rose to $5.29 from $4.86 a year earlier.
Comparable sales excluding gasoline and foreign exchange rates increased 6.3% in the quarter and rose 5.0% in the fiscal year.
E-commerce comparable sales soared 19.5% in the quarter and 16.2% in the fiscal year, as members continued to search for bargains online.
Vail Resorts, Inc. declined 4.1% to $180.01 after the ski resort operator reported weaker-than-expected quarterly results.
Revenue in the fiscal fourth quarter ending in July declined to $265.4 million from $269.8 million, net loss attributable to shareholders expanded to $177 million from $128.5 million, and diluted loss per share increased to $4.67 from $3.35.
- Inga Muller
- 27 Sep, 2024
- Frankfurt
Market indexes in Frankfurt and Paris extended their weekly gains to 4% and in London gained 1% amid Chinese leaders pledge of significant fiscal measures following the raft of monetary measures earlier in the week.
The DAX index increased by 1.1% to 19,129.17; the CAC-40 index rose by 1.5% to 7,677.44; and the FTSE 100 index rose by 0.2% to 8,285.97.
The yield on 10-year German bonds edged higher to 2.15%, French bonds inched lower to 2.94%, the UK gilts edged up to 4.0%, and Italian bonds decreased to 3.46%.
China-linked vehicle makers and luxury goods companies traded higher for the fourth day in a row amid rising hopes of additional fiscal stimulus.
Mercedes-Benz Group AG increased 2.9% to €59.42, Volkswagen Group advanced 2.2% to €97.44, and BMW gained 2.9% to €80.80.
LVMH increased 1.2% to €687.20, Hermes International added 1.1% to €2,230.40, Kering SA advanced 3.8% to €260.35, Prada SpA jumped 6.8%, and Richemont traded up 1.1% to CHF 132.65.
Moncler SpA jumped 8.9% to €56.72 after LVMH agreed to acquire a 1.6% stake in the company.
LVMH acquired a 10% stake in the holding company, Double R, owned by chief executive Remo Rufini, that controls a 15.8% stake in the publicly traded company.
LVMH can increase its stake in the investment vehicle that controls Moncler, Double R, to as much as 22%.
With the LVMH's investment, Double R plans to increase its holding in Moncler to 18.5% from 15.8%, and become the largest shareholder in the outerwear maker.
LVMH will have one board seat on Moncler and two on Double R.
- Bridgette Randall
- 27 Sep, 2024
- London
Stock market indexes in Europe advanced in Friday's trading following the faster-than-expected cooling of inflation in France and Spain.
Benchmark indexes in Frankfurt, Paris, and London gained, and market sentiment was boosted after Chinese leaders pledged for additional large fiscal stimulus measures.
On Friday, China's leaders pledged to provide additional fiscal stimulus during an emergency meeting chaired by President Xi Jinping.
The meeting followed wide-ranging monetary stimulus measures announced by the People's Bank of China on Tuesday.
Sources in Beijing also confirmed that China is preparing to inject an additional one trillion yen into the state-controlled banks over the next three weeks, supporting lending to corporations.
The central bank today cut the 50 basis points reserve ratio for commercial banks, following the announcement on Tuesday.
The latest cut in reserves ratio is expected to release an additional one trillion yuan for loans by commercial banks.
Inflation in France and Spain Cooled in August
Closer to home, inflation in Spain and France fell more than expected in September, supporting the case for the European Central Bank to lower its policy lending rate at the next meeting.
Consumer price inflation in France slowed to 1.2% in September from 1.8% in August, the statistical agency, INSEE, reported today.
France's inflation fell sharply after energy price deflation was 3.3% compared to an inflation of 11.9% a year ago and 0.4% in the previous month.
Goods prices declined at a faster pace of 0.3% from 0.1% in the previous month and fell from an inflation rate of 2.8% from a year ago.
Consumer price inflation in Spain eased to 1.5% in September from 2.3% in August, the statistical agency, INE, reported Friday.
Core inflation, which excludes food and energy prices, slowed to 2.4% from 2.7% in the previous month.
On a monthly basis, overall consumer price inflation was -0.6% and core inflation was -0.4%.
In other economic news in the region, Germany's seasonally adjusted jobless rate held steady for the fourth month in a row at 6.0%.
The number of jobless people increased from 17,000 to 2.823 million, and job openings fell from 65,000 to 696,000.
Europe Indexes and Yields
The DAX index increased by 1.1% to 19,129.17; the CAC-40 index rose by 1.5% to 7,677.44; and the FTSE 100 index rose by 0.2% to 8,285.97.
The yield on 10-year German bonds edged higher to 2.15%, French bonds inched lower to 2.94%, the UK gilts edged up to 4.0%, and Italian bonds decreased to 3.46%.
The euro edged lower to $1.11; the British pound inched higher to $1.33; and the U.S. dollar weakened to 84.38 Swiss cents.
Brent crude decreased $0.12 to $71.70 a barrel, and the Dutch TTF natural gas fell by €0.33 to €38.03 per MWh.
Europe Stock Movers
China-linked vehicle makers and luxury goods companies traded higher for the fourth day in a row amid rising hopes of additional fiscal stimulus.
Mercedes-Benz Group AG increased 2.9% to €59.42, Volkswagen Group advanced 2.2% to €97.44, and BMW gained 2.9% to €80.80.
LVMH increased 1.2% to €687.20, Hermes International added 1.1% to €2,230.40, Kering SA advanced 3.8% to €260.35, Prada SpA jumped 6.8%, and Richemont traded up 1.1% to CHF 132.65.
Moncler SpA jumped 8.9% to €56.72 after LVMH agreed to acquire a 1.6% stake in the company.
LVMH acquired a 10% stake in the holding company, Double R, owned by chief executive Remo Rufini, that controls a 15.8% stake in the publicly traded company.
LVMH can increase its stake in the investment vehicle that controls Moncler, Double R, to as much as 22%.
With the LVMH's investment, Double R plans to increase its holding in Moncler to 18.5% from 15.8%.
LVMH will have one board seat on Moncler and two on Double R.
- Akira Ito
- 27 Sep, 2024
- Tokyo
Japan's stock market indexes overcame morning doldrums to close at a two-week high on Friday and extended their weekly advance.
The Nikkei 225 stock average edged up 1%, and the broader Topix index gained 0.2%, following the gains in overnight trading in New York.
For the week, the Nikkei 225 advanced 4.5% and the Topix gained 3.4%.
Market sentiment was positive after the release of better-than-expected U.S. jobless claims, durable goods orders, and second quarter GDP growth data.
Moreover, investors boosted their holdings of semiconductors and related stocks after Micron Technology estimated higher revenue and profit in the current quarter.
Closer to home, investors also reviewed the latest update on Tokyo-area inflation data.
Overall consumer price inflation in September slowed to 2.2% from 2.6% in August, the Bank of Japan said in a release Friday.
Core inflation, which only excludes volatile food prices but not energy, slowed to 2.0% from 2.4%, halting a 4-month acceleration in price increases.
The latest inflation matched the target rate set by the Bank of Japan, driven by a fall in energy prices and slowing food price inflation.
Tokyo's inflation is widely considered a harbinger of the nationwide price trend, and Japan's inflation data generally follow about three weeks later.
Earlier in the week, policymakers at the central bank noted the need to sharpen focus on inflation and favored a gradual approach to increasing inflation, according to the minutes of the previous policy meeting.
The yen weakened to 146.27 against the yen and fell to a three-week low as investors reviewed the latest inflation update in the Tokyo area.
Elsewhere in Asia, China's leaders released a statement pledging more fiscal support after an emergency meeting chaired by President Xi Jinping.
The latest statement to approve more government spending boosted market sentiment and lifted market indexes in Hong Kong and mainland China to a gain of over 13% in the week and over 20% from the lows reached two months ago.
Japan Stock Movers
The Nikkei 225 Stock Average increased 1.4% to 39,472.0, and the broader Topix index added 0.2% to 2,726.53.
Tech stocks led the gainers in Tokyo trading and extended weekly gains over 10%.
Tokyo Electron gained 6.5% to ¥27,170.0, Lastertec Corporation jumped 7.7% to ¥26,130.0, and Advantest Corp. increased 3.8% to ¥7,143.0.
Mitsubishi UFJ Financial decreased 0.7% to¥1,447.50, Sumitomo Mitsui Financial declined 1.5% to ¥2,957.50, and Mizuho Financial fell 0.8% to ¥2,814.50.
Seven & I Holdings added 0.4% to ¥2,214.0, Isetan Mitsukoshi rose 6.5% to ¥2,460.0, and Fast Retailing added 1.4% to ¥48,590.0.
Itochu Corp. advanced 0.3% to ¥7,897.0, Marubeni Corp. increased 1.4% to ¥2,417.50, Mitsubishi Corp. jumped 2% to ¥3,070.0, and Mitsui & Company added 2.3% to ¥3,264.0.
Kawasaki Kisen Kaisha Ltd. added 2.2% to ¥2,246.50, Nippon Yusen traded higher 1.7% to ¥5,307.0, and Mitsui O.S.K. Lines advanced 2.2% to ¥5,047.0.
Toyota Motor Corp. jumped 1.7% to ¥2,744.0, Honda Motor advanced 2.2% to ¥1,616.0, and Nissan Motor rebounded 4.7% to ¥427.70.
- Li Chen
- 27 Sep, 2024
- Hong Kong
Stock market indexes soared for the fourth consecutive day after Chinese leaders pledged to announce more measures to revive faltering economic growth.
The People's Bank of China lowered the reserve requirement ratio for all banks by 50 basis points on Friday, following the announcement on Tuesday.
The Hang Seng index and the CSI 300 index jumped more than 3% and extended their weekly surge to over a whopping 13% amid a stock-buying spree by investors.
Today's market surge was driven by the expectations of more fiscal measures, according to an official statement released after an unexpected Politburo meeting chaired by President Xi Jinping.
“The vast number of party members and cadres must have the courage to take responsibility and dare to innovate,” noted the statement released after the meeting.
The meeting underscored the urgency for sharpening the focus on economic priorities as the top leadership shifts their attention away from military expansion and modernization.
The emergency policy meeting focused on boosting government spending, effectively implementing current policies, and increasing efforts to achieve an economic growth target rate of around 5%.
Moreover, the meeting called for additional necessary spending to stabilize the slumping property market and increase funding for local government.
Chinese leaders stepped up calls to revive economic growth after initial measures released four months ago to support the property market failed to make a dent.
In a much-delayed move, China's State Council announced 24-point guidelines to strengthen protection for gig workers and encourage job creation by state-controlled entities.
The yuan traded around 7.0 against the U.S. dollar, but bank stocks traded down.
Despite economic revival talks by top leaders, there were no clear and quantitative measures announced after the meeting.
Investors are hoping that Beijing will roll out large and meaningful measures after the National Holiday and avoid ramping up of wasteful spending carried out after the 2008 global financial crisis.
China Stock Movers
The Hang Seng index jumped 3.5% to 20,621.90, and the mainland-focused CSI 300 index soared 3.8% to 3,678.98.
Alibaba Group jumped 5.4% to $103.60, JD.com advanced 8.5% to $153.60, Tencent Holdings added 2.7% to HK $441.80, and Baidu Inc. advanced 5.6% to HK $101.20.
Bank of China decreased 2.5% to HK $3.75, ICBC fell 3.1% to HK $4.68, and China Merchants Bank fell 1% to HK $37.25.
China Vanke Company jumped 11% to HK $6.38, China Resources Land gained 3% to HK $27.35, and Longfor Group advanced 12% to HK $13.22.
- Alexander Garcia
- 26 Sep, 2024
- Miami
Benchmark indexes extended their two-week run amid positive market sentiment following better-than-expected economic data.
The S&P 500 index traded at a new intraday high, and the Nasdaq Composite approached its record high reached in July.
Market sentiment improved after the latest weekly jobless claims, durable goods orders, and GDP growth revisions met investor expectations.
Initial weekly jobless claims decreased 4,000 to 218,000 at the end of the last week, the U.S. Department of Labor reported Thursday.
Jobless claims dropped to a 4-month low, and continuing claims, which lag by a week, rose 13,000 to 1.834 million.
Despite the recent decline in jobless claims, labor market conditions have softened from a year ago and earlier months in the year as employers avoid adding new staff.
Investors are now awaiting the release of monthly nonfarm payroll data, which could provide additional insights into the current conditions of the labor market.
U.S. Q2 GDP Growth Confirmed In Third Estimate
The second quarter GDP growth estimate was unrevised at 3.0% in the third estimate and higher than the 1.6% increase in the first quarter, the Bureau of Economic Analysis reported Thursday.
The GDP update primarily reflected upward revisions to private inventory investment (8.3% from 7.5%) and federal government spending (4.3% from 3.3%) that were offset by downward revisions to nonresidential fixed investment (3.9% from 4.6%) and exports (1% from 1.6%).
Imports, which are a subtraction in the calculation of GDP, were revised.
The government agency also revised its GDP growth estimate in the first quarter to 1.6% from the previous estimate of 1.4%, primarily reflecting an upward revision to consumer spending that was partly offset by downward revisions to private inventory investment and residential fixed investment.
U.S. Durable Goods Orders Unchanged In August
In other economic news, new orders for manufactured durable goods were nearly unchanged from the previous month in August, the U.S. Census Bureau reported Thursday.
New order growth slowed sharply from the 9.8% surge in July, which was the highest rate of growth in four years.
The better-than-expected orders contrasted with the growing pessimism about manufacturing sector activities, suggesting that the current slowdown may be temporary.
New orders excluding transportation increased 0.5%, and excluding volatile defense goods eased 0.2%.
On an annual basis, new orders for durable goods declined 1.3%.
Non-defense capital goods orders declined 1.3% from the previous month in August, and excluding volatile aircraft orders rose 0.2%.
From the previous year, non-defense capital goods orders dropped 6.5%, and excluding aircraft rose 0.3%.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.2% to 5,713.52, the Nasdaq Composite rose 0.2% to 18,114.49, and the Russell 2000 index rose 0.7% to 2,213.77.
The yield on 2-year Treasury notes edged higher to 3.59%, 10-year Treasury notes inched up to 3.77%, and 30-year Treasury bonds inched higher to 4.12%.
WTI crude oil increased $2.25 to $67.42 a barrel, and natural gas prices edged down 1 cent to $2.80 a thermal unit.
Gold rose by $14.80 to $2,671.10 an ounce, and silver increased by $0.25 to $32.08.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 100.77.
U.S. Stock Movers
Micron Technology soared 17% to $111.87 after the advanced semiconductor company reported better-than-expected quarterly results.
The company also estimated higher revenue and earnings in the current quarter.
Southwest Airlines Company increased 9.8% to $31.26 after the regional airline announced its stock buyback plan of $2.5 billion.
The company also said its third quarter revenue is expected to rise as much as 3% compared to its previous estimate of a decline of 2%.
The company also announced a host of other changes to its business model and named Bob Fornaro, who previously led Spirit Airlines, to its board of directors.
China-linked stocks soared for the third day in a row after China's politburo announced their commitment to revive economic growth to 5%.
JD.com, Alibaba Group, Tencent Holdings, and Baidu jumped between 5% and 9%.
European Indexes Jump 1% Tracking Higher Global Markets
European markets advanced following the rise in global markets after China announced strong monetary stimulus.
Benchmark indexes in Paris, London, and Frankfurt jumped as much as 1.5% after China's Politburo pledged to provide additional stimulus to meet an economic growth target of 5% in the current year.
Chinese authorities are considering injecting as much as one trillion yuan in the state-controlled banks, the largest injection since 2008.
In addition, Chinese authorities are considering providing direct cash assistance to as many as 25% of the population, which could increase consumption of basic items.
Global tech stocks advanced after Micron Technology estimated higher sales and earnings, providing another upward push to semiconductor-related stocks in Europe, Japan, and South Korea.
Closer to home, the Swiss National Bank lowered its policy rate by 25 basis points to 1.0%, a third consecutive decrease in rates, and the cost of borrowing dropped to the lowest since early 2023.
The central bank noted that policymakers are prepared to lower rates in the coming quarters, if necessary, citing a weakening inflation outlook.
The Swiss National Bank lowered its inflation outlook to 1.2% from 1.3% in 2024, 0.6% from 1.1% in 2025, and 0.7% from 1.0% in 2026.
The central bank left its gross domestic product growth estimate at around 1% in 2024 and 1.5% in 2025.
Bank lending to households increased 0.6% to Є6.891 trillion in August, accelerating from 0.5% in the previous month, the European Central Bank reported Tuesday.
The increase in lending to households was the fastest since October 2023, amid a slight pick up in consumer demand.
Meanwhile, lending to corporations increased by 0.8% to Є5.133 trillion, a faster increase than in July.
Overall lending to the private sector, including households and non-financial corporations, increased by 1.6% from 1.3% in the previous month.
Europe Indexes and Yields
The DAX index increased by 1.7% to 19,238.36; the CAC-40 index rose by 2.3% to 7,742.09; and the FTSE 100 index rose by 0.2% to 8,284.91.
The yield on 10-year German bonds edged lower to 2.14%, French bonds inched lower to 2.94%, the UK gilts edged up to 3.99%, and Italian bonds decreased to 3.45%.
The euro edged lower to $1.11; the British pound inched higher to $1.33; and the U.S. dollar weakened to 84.72 Swiss cents.
Brent crude decreased $1.80 to $71.66 a barrel, and the Dutch TTF natural gas fell by €0.04 to €37.52 per MWh.
Europe Stock Movers
H&M Mennes & Mauritz AB dropped 4.5% to SEK 174.10 after the Swedish apparel retailer reported weaker-than-expected fiscal this quarter results.
China-linked companies in Europe advanced after Chinese leaders pledged additional support to meet the annual economic growth target rate of 5%.
Vehicle makers, luxury goods purveyors, and mining companies advanced for the third session in a row.
Antofagasta gained 5.7% to 2,030.0 pence, Anglo American jumped 5.9% to 2,434.0 pence, and Glencore increased 4.8% to 422.75 pence.
LVMH soared 7.4% to €663.50, Hermes International SCA added 7.2% to €2,178.0, Kering SA advanced 8.2% to €247.80, Richemont SA jumped 5.6% to CHF 129.40, Moncler SpA increased 6.6% to €52.08, and Prada gained 2.4% to €6.18.
Puma SE increased 4.3% to €38.45 after the athletic footwear maker appointed Markus Neubrand as the company's chief financial officer and a board member.
Commerzbank AG increased 5.3% to €16.17 after the German lender estimated higher profit and return on equity by 2027.
BASF SE decreased 2.2% to €44.33 after the German chemical company announced its plans to lower its fiscal year 2024 dividend to at least €2.25 per share, payable in 2025.
The revised dividend is a decrease from the €3.40 per share dividend paid in 2023.
The German chemical company plans to distribute €12 billion between 2025 and 2028, including €8 billion of stock buybacks and €2 billion of dividend payments, the company said in a statement.
The company also estimated cumulative dividends to exceed €12 billion in the period between 2025 and 2028 and return on capital to reach 10% by 2028.
SMA Solar Technology AG increased 2.2% to €17.48 after the German company announced a companywide restructuring to increase efficiency, sharpen strategic focus, and lower operating costs.
Rally In Semiconductor Stocks Powered 2.5% Surge In Japan Indexes
Stock market indexes in Tokyo traded at three-week highs following a rebound in semiconductor and related stocks.
The Nikkei 225 stock average and the Topix index jumped more than 2.5% after Micron Technology reported better-than-expected quarterly results after the close of the regular trading session in New York.
Investors also reviewed the latest policy meeting minutes, and several policymakers cautioned against creating excessive expectations about future rate hikes and called for sharper focus on upward inflation risks.
The yen traded in a tight range and edged up 0.04% to 144.77 after the Bank of Japan's policy meeting minutes showed the committee prefers a gradual approach to increasing interest rates in the future.
The surge in semiconductor stocks also boosted market indexes in South Korea, and the KOSPI index advanced 2.6%.
In other Asian markets, benchmark indexes in India crossed another record high and extended a string of highs to close to 60 in 2024, amid positive market sentiment and earnings optimism.
Benchmark indexes in mainland China and Hong Kong extended their three-day tally to over 7% as investors stepped up to buy riskier stocks in the hopes of additional market-supportive measures following the announcement of wide-ranging monetary stimulus measures.
Japan Stock Movers
The Nikkei 225 Stock Average jumped 2.8% to 38,925.63, and the broader Topix index advanced 2.6% to 2,721.12.
Tech stocks led the surge in Tokyo trading in the hopes of improving business after Micron Technology reported better-than-expected quarterly results.
Tokyo Electron jumped 8% to ¥25,760.0, Advantest soared 5.4% to ¥6,900.0, Screen Holdings gained 5.9% to ¥10,410.0, and Lasertec added 0.1% to ¥24,250.0.
Banks also participated in the market surge after the latest policy meeting minutes suggested that the central bank is looking to raise rates in gradual steps and not in sharp increments.
Mitsubishi UFJ Financial advanced 2.5% to ¥1,481.50, Sumitomo Mitsui added 3.2% to ¥9,174.0, and Mizuho Financial Group gained 2.7% to ¥2,894.50.
Retail stocks traded higher amid market rally and stable yen.
Seven & I Holdings increased 2.1% to ¥2,206.50, Aeon Co. Ltd. gained 1.6% to ¥2,206.50, Fast Retailing advanced 1.7% to ¥47,900.0, and Isetan Mitsukoshi jumped 7.6% to ¥2,326.0.
China's Indexes Extended Stimulus Rally to Third Day Amid Hopes of Additional Measures
Benchmark indexes in mainland China and Hong Kong extended gains for the third consecutive day after Beijing rolled out stimulus measures.
The Hang Seng index jumped 2.7% and the CSI 300 index advanced 2.3%, and the benchmark indexes extended three-day gains to over 7%.
The wide-ranging stimulus measures revived market confidence in Beijing's leadership in the hopes that the regulators and policymakers are finally serious about reviving economic growth and tackling multi-year property market malaise.
Investors stepped up to buy tech- and consumer-focused stocks amid expectations that the Politburo is likely to approve injecting as much as one trillion yuan into state-controlled banks.
Despite the wide-ranging monetary policy measures released by the People's Bank of China, caution prevailed in stock trading amid worries of weak consumer sentiment and persistent weakness in the residential property market.
China Stock Movers
The Hang Seng index soared 2.7% to 19,641.05, and the mainland-focused CSI 300 index jumped 2.3% to 3,478.54.
Tech stocks led gainers in Hong Kong after investors stepped up to increase exposure to high-growth and riskier stocks.
Tencent Holdings jumped 4% to $421.60, Alibaba Group advanced 6.5% to HK $97.25, and JD.com soared 8.2% to HK $136.10.
China Vanke added 13.4% to HK $5.34, China Resources Land added 11.9% to HK $24.45, and Longfor Group jumped 10.2% to HK $10.34.
New World Development was halted at HK$8.19, and the company's chief executive, Adrian Cheng, is set to step down ahead of the company's releasing its annual financial results later in the day.
The residential property developer is expected to announce losses totaling as much as HK $20 billion or $2.5 billion, reflecting a sharp decline in property valuations.
Hong Kong-based property developers were in focus after New World Development news.
CK Asset Holdings dropped as much as 1.5% to HK $32.35 before recovering to trade higher by 0.2% to HK $32.80.
Sun Hung Kai Properties edged up 0.2% to HK $82.95 and rebounded from earlier losses of as much as 1.3%.