The US stock indices were mainly on the rise yesterday. At the close of the New York Stock Exchange, the Dow Jones index remained almost unchanged, NASDAQ increased by 0.62%, and the S&P 500 index added 0.30%, setting another price high. The negative market trend was driven by the oil and gas sector and the telecom and commodities industries. However, indices rose due to the strengthening of the consumer goods and technology sectors.
Fed member Bostic said yesterday that supply disruptions and high inflation will continue through 2022. Fed spokesman Waller pointed out that the Fed’s reduction in asset purchases is consistent with the US economic outlook. At the same time, policymakers do not expect a big shock to the market when the monetary policy cuts begin.
The US Federal Reserve announced new restrictions on officials’ investment activities. New Fed rules now prohibit Fed officials from trading stocks and bonds.
Yesterday, famous billionaire and hedge-fund manager Paul Tudor Jones warned that the Fed is moving in the wrong direction on inflation. Wage inflation caused by labor shortages has contributed to the current inflationary picture, and ultimately the recent price increases may be just the beginning.
The US Food and Drug Administration (FDA) approved an emergency booster dose of the Johnson&Johnson COVID-19 vaccine for adults 18 years of age and older. The booster vaccine will be applied no earlier than two months after the primary vaccination.
European stock markets closed yesterday in the negative area. At the end of the trading day, Germany’s DAX index decreased by 0.3%, Britain’s FTSE 100 lost 0.45%, France’s CAC 40 fell by 0.3%, Italy’s FTSE MIB decreased by 0.2%, and Spain’s IBEX 35 lost 0.8%. This time, strong corporate reports from many European companies did not help the indices. Europe has faced several problems in recent months, from rising energy prices and supply chain problems to a slowing economic recovery and uncertainty about monetary policy from the ECB. The crisis in China’s real estate sector, with debt problems for many real estate developers, also adds to the concerns.
Electricity prices in Germany have set a new price record. In France, to reduce high energy costs for consumers, the government will decide on a €100 help for people earning less than €2k a month.
Russian President Vladimir Putin said yesterday that the gas deficit in Europe could reach about 70 billion cubic meters. He added that Russia could quickly increase gas supplies to Europe via Nord Stream 2.
At the largest US crude oil warehouse, inventories are rapidly approaching critically low levels. The last time this happened, oil cost more than 100 dollars per barrel. The price of oil in Tokyo has hit a record high again. Meanwhile, US President Joe Biden said Americans should expect gasoline prices to remain high next year because OPEC is holding back supplies.
China’s main stock indices closed higher on the back of a recovery in the real estate and coal sectors. The troubled Chinese real estate developer Evergrande unexpectedly paid interest to its investors and moved away from the brink of default. China’s blue-chip index CSI300 added 0.3% and the real estate index increased by 2.5%. Hong Kong’s Hang Seng index increased by 0.4%, and Japan’s Nikkei gained 0.7% on technology stocks.
Turkey’s central bank cut its discount rate from 18% to 16% amid a record drop in the Turkish lira.
Main market quotes:
- S&P 500 (F) 4,549.78 +13.59 (+0.30%)
- Dow Jones 35,603.08 −6.26 (−0.018%)
- DAX 15,472.56 −50.36 (−0.32%)
- FTSE 100 7,190.30 −32.80 (−0.45%)
- USD Index 93.77 +0.22 (+0.23%)
Important events for today:
- Japan National Consumer Price Index (m/m) at 02:30 (GMT+3);
- UK Retail Sales (m/m) at 09:00 (GMT+3);
- German Manufacturing PMI (m/m) at 10:30 (GMT+3);
- German Service PMI (m/m) at 10:30 (GMT+3);
- Eurozone Manufacturing PMI (m/m) at 11:00 (GMT+3);
- Eurozone Service PMI (m/m) at 11:00 (GMT+3);
- UK Manufacturing PMI (m/m) at 11:30 (GMT+3);
- UK Service PMI (m/m) at 11:30 (GMT+3);
- Canada Retail Sales (m/m) at 15:30 (GMT+3);
- US Manufacturing PMI (m/m) at 16:45 (GMT+3);
- US Service PMI (m/m) at 16:45 (GMT+3);
- US FOMC Member Daly Speaks at 17:00 (GMT+3).