“Investors are tempted to take part of their profits at the end of an exceptional November,” observes Franklin Pichard, CEO of Kiplink Finance. (Photo: 123RF)
Caution was required in this last financial year of an “exceptional” November on the markets.
Wall Street was preparing to open lower. Futures contracts on major New York market indices announced a decline of 0.54% to 29,714 points for the Dow Jones, 0.34% to 3624 points for the S&P 500 and a Nasdaq in equilibrium before opening (+ 0.05%) at 12,263 points.
On a European scale, the evolution was done in dispersed order: the CAC 40 of Paris fell by 0.26% to 5583 points around 7:20 am, while Frankfurt advanced by 0.35% to 13,382 points, and London of 0.16% at 6377 points.
“The main European markets are stalling (…) despite the publication of a Chinese manufacturing PMI index signing its 9th straight increase and its highest level since September 2017”, observes Franklin Pichard, CEO of Kiplink Finance.
“Investors are tempted to take part of their profits at the end of an exceptional month of November thanks to the election of Joe Biden and above all, the announcement of the next vaccines against Covid-19”, explains the analyst.
Falling oil prices also weighed on the trend, as doubts hover over an agreement from OPEC + members who are meeting Monday and Tuesday by videoconference to decide on their black gold production cuts from January.
The markets were bathed in November in optimism linked to an upcoming vaccination against Covid-19, the allaying of fears about US policy with the election of President Joe Biden as well as the budgetary and monetary support given to the economy.
In the afternoon, investors will analyze figures on US real estate and manufacturing activity in the Chicago area in November.
The large Asian stock markets ended in the red on Monday, Tokyo seeing itself dominated by profit taking and Hong Kong falling in the face of the upsurge in coronavirus which raises fears of new restrictive measures.
In the former British territory, where the authorities have warned of the arrival of a new wave of Covid-19, the Hang Seng index has slipped by 2.06% to 26,342 points.
The Shanghai Composite Index fell 0.49% to 3,392 points and that of Shenzhen fell 0.15% to 2,250 points.
In Tokyo, the Nikkei star index dropped 0.79% to 26,434 points and the expanded Topix index lost 1.77% to 1,755 points.
The Nikkei, after advancing throughout the past week, moved further higher on Monday morning, as markets were encouraged by good global stock market results on Friday.
Profit-taking then weighed on Tokyo, however, due to “cautious sentiment after the hikes,” noted Okasan Online Securities.
The rise in the number of new daily cases of coronavirus in Japan has also led to the implementation of restrictive measures, especially in Tokyo and Osaka (western Japan), however less restrictive than those observed in other countries.
On the oil side
Oil prices were in the red, having finished near breakeven before the weekend. OPEC and its allies were to meet Monday and Tuesday to try to restore some vigor to a crude market still depressed by the pandemic.
The price of a barrel of American crude WTI lost 1.19% to 44.97 dollars and that of Brent from the North Sea fell by 1.33% to 47.54 dollars.