Global stock markets have enjoyed a largely positive week, despite political turmoil in Europe and the Far East.
Investors have shrugged off the collapse of the French government and an ultimately unsuccessful attempt by South Korean president, Yoon Suk Yeol, to impose martial law. Instead, the focus has been on positive economic news from the US and China, as well as the increasing likelihood of further interest rate cuts in the eurozone. Meanwhile, Bitcoin has continued its recent rise, bursting through the $100,000 (£78,000) barrier for the first time on Wednesday. This followed the news that US president-elect Donald Trump plans to nominate cryptocurrency advocate Paul Atkins to lead the Securities and Exchange Commission, America’s financial regulator.
United States
On Wall Street, the Dow Jones Industrial Average ended trading on Thursday 0.3% lower for the week so far, with the S&P 500 gaining 0.7%. Both indexes hit all-time highs during the week, although the Dow paused for breath on Thursday, giving up a small portion of its recent gains. Economic data in the US continues to show resilience, with further rises reported in manufacturing output. However, there were some signs of weakness in terms of slight underperformance in November’s service sector figures. Investors will await forthcoming employment data, which is expected to show a solid recovery from October’s decline.
UK
In the UK, the FTSE 100 closed on Thursday 0.7% up for the week so far, despite further signs of deterioration in the British economy. Activity in the manufacturing sector hit its lowest level since the start of the year in November, while confidence among businesses in general has fallen due to concerns about higher taxes on employers and the potential impact of Trump’s tariffs in 2025. However, energy companies benefited from rising oil prices, with OPEC expected to announce production cuts, and there were signs of acceleration in the housing market.
Europe
In Frankfurt, the DAX index ended Thursday’s session up 3.7% for the week, while France’s CAC 40 gained 1.3%. Shares across the eurozone performed strongly despite political turmoil in France, where recently installed prime minister, Michel Barnier, failed to survive a no confidence vote. Disappointing economic data appears to have raised the chances that the European Central Bank will continue cutting interest rates into 2025. Latest research showed that the recession in European manufacturing had deepened, while retail sales across the eurozone fell more quickly than expected last month.
Asia
In Asia, the Hang Seng index in Hong Kong gained 0.7% after positive data from China’s factory sector suggested that the government’s massive stimulus announced in September might be starting to bear fruit. Japan’s Nikkei 225 index of leading shares, meanwhile, advanced 3.1% to recover some of November’s losses. The country’s services sector returned to growth in November, and the government announced a financial support package for semiconductor firms.
November 29 | December 5 | Change (%) | |
|---|---|---|---|
FTSE 100 | 8287.3 | 8349.4 | 0.7 |
FTSE 250 | 20771.6 | 21001.1 | 1.1 |
S&P 500 | 6032.4 | 6075.1 | 0.7 |
Dow Jones | 44910.7 | 44765.7 | -0.3 |
DAX | 19626.5 | 20358.8 | 3.7 |
CAC 40 | 7235.1 | 7330.5 | 1.3 |
ACWI | 862.5 | 872.3 | 1.1 |
Hong Kong Hang Seng | 19423.6 | 19560.4 | 0.7 |
Nikkei 225 | 38208.0 | 39395.6 | 3.1 |
Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 5 December 2024.
