2023-12-22 01:30:10
(Photo: The Canadian Press)
MARKET REVIEWS. Global markets were mostly down Thursday morning, as several companies reported results below expectations in the final hours.
Stock market indices at 7:00 a.m.
In Germany, Frankfurt lost 0.3%, just like Paris, In France. The FTSE 100 of London fell by 0.1%.
In Asia, Tokyo fell 1.6%. The Japanese car manufacturer Toyota notably lost 4%, while it announced on Wednesday the recall of a million vehicles due to problems linked to certain airbags.
Elsewhere, the S&P/ASX 200 Australia experienced a decline of 0.5%, while the Kospi South Korean conceded 0.6%. Hong Kong was stable and Shanghai gained 0.6%.
In New York, before the markets opened, the average Dow Jones industrial stocks rose 0.4%, while the broader index S&P 500 gained 0.5%.
On the New York Commodity Exchange, the price of oil gained 22 US cents to US$74.44 per barrel.
The context
“Market optimism is starting to crack,” observes Ipek Ozkardeskaya, analyst at Swissquote Bank, who notably puts forward the “12% plunge in FedEx — which acts as an indicator of economic activity” as the reason for the drop in the day before.
For Deutsche Bank analysts, “a movement to reduce risk exposure” was also a factor in Wednesday’s declines.
The markets have been driven for a week by expectations of interest rate cuts in 2024, after the last meeting of the American central bank, the Federal Reserve.
Investors are becoming “even more confident about the chances of the Fed cutting rates in 2024,” according to Deutsche Bank analysts.
To try to confirm this scenario, market operators will scrutinize the publication of the PCE inflation index for November on Friday, the American Fed’s preferred barometer for price increases.
The indicator could “contain the crucial tarot cards that could drive market dynamics through the end of the year and beyond,” comments Stephen Innes, partner at SPI Asset Management.
On the bond market, interest rates on government borrowing were stable earlier this morning. The yield on the 10-year U.S. Treasury note stood at 3.87%, after finishing at 3.85% on Wednesday.
Toyota falls after scandal
Toyota fell 4.02% in Tokyo after the announcement of a recall in the United States of around a million vehicles from the Toyota and Lexus brands due to an airbag problem, and the day after the suspension by its subsidiary Daihatsu of deliveries of all of its models due to a vast scandal of falsification of its safety tests.
Toyota has promised “fundamental reform” to revitalize Daihatsu and said it would be necessary to review management and commercial operations, but also the organization and structure of the company.
Sony has sold 50 million PS5s
The Japanese entertainment giant Sony announced on Wednesday that it had sold more than 50 million copies of its PlayStation 5 released in November 2020, confirming a strong acceleration in sales of the console whose production and shipments have long been undermined by the disruption of supply chains and shortages linked to the pandemic.
Oil, euro and bitcoin stable
Oil prices were rather stable earlier this morning, in a context still marked by tensions in the Red Sea.
The price of a barrel of Brent from the North Sea, for delivery in February, gained 0.16%, to 79.84 US dollars. Its American equivalent, the West Texas Intermediate (WTI), with maturity in January, gained 0.13%, to 74.32 US dollars.
On the foreign exchange market, the euro was also close to balance against the greenback (+0.08%), at 1.0951 US dollars per euro.
Bitcoin was stable at US$43,777.
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