Global eq­ui­ties mixed; US and Ja­pan ad­vance

Kuwait Times - - BUSINESS -

Over­all, global eq­ui­ties had mixed per­for­mance with Ja­pan and US lead­ing while emerg­ing mar­kets and UK eq­ui­ties were the ma­jor lagers. US eq­ui­ties ral­lied, fol­low­ing poor per­for­mance back in Oc­to­ber, gain­ing 3.7 per­cent as mea­sured by the S&P 500, as a re­sult of Trump’s vic­tory, which is ex­pected to lead to tax cuts and in­fra­struc­ture spend­ing. Com­modi­ties were mixed for the month with Gold down 8.1 per­cent while Brent Oil is up 4.5 per­cent. OPEC’s de­ci­sion in its meet­ing on Novem­ber 30 in Vi­enna, to cut pro­duc­tion levels for the first time in eight years, has driven crude oil prices up by 8.8 per­cent in the last day of trad­ing of the month. im­ports, which has fallen faster than ex­ports. The Nikkei Man­u­fac­tur­ing PMI re­mains slightly above 50 at 51.3 com­pared to 51.4 in the pre­vi­ous month. Ja­pan’s CPI rose YoY 0.1 per­cent in Oc­to­ber break­ing the de­clin­ing trend over the past seven months. The un­em­ploy­ment rate re­mains at 3 per­cent in Oc­to­ber, un­changed from Septem­ber, the low­est since 1995; how­ever, Real GDP grew at a rate of 0.5 per­cent QoQ in Q3.

Ja­panese eq­ui­ties con­tinue to per­form con­sid­er­ably well, as mea­sured by the Nikkei 225, gen­er­at­ing re­turns of 5.1 per­cent in Novem­ber.

Chi­nese ex­ports dropped 7.3 per­cent in Oc­to­ber, an im­prove­ment from the 10 per­cent de­cline in Septem­ber and im­ports de­clined by 1.4 per­cent YoY. CPI in­creased, on a YoY ba­sis, from 1.9 per­cent in Septem­ber to 2.1 per­cent in Oc­to­ber. The Caixin Man­u­fac­tur­ing PMI dropped to 50.9 in Novem­ber com­pared to 51.2 in Oc­to­ber.

Al­though emerg­ing mar­ket eq­ui­ties ended the month down 4.7 per­cent, Chi­nese eq­ui­ties, as mea­sured by the Shang­hai Stock Ex­change Com­pos­ite In­dex, gen­er­ated re­turns of 4.8 per­cent.

The GCC eq­uity mar­ket con­tin­ued to per­form well end­ing the month of Novem­ber with gains of 7.8 per­cent, sup­ported by Saudi eq­uity mar­ket, which in­creased 16.4 per­cent. In ad­di­tion, UAE eq­ui­ties, Dubai and Abu Dhabi, re­cov­ered from last month post­ing mi­nor gains of 0.9 per­cent and 0.2 per­cent, re­spec­tively. The gains in Saudi stocks were sup­ported by de­layed pay­ments fi­nally be­ing made to con­trac­tors amount­ing to SR40 bil­lion and the an­nounce­ment that an­other SR100 bil­lion will be paid out by the end of De­cem­ber. Abu Dhabi’s im­proved per­for­mance this month comes from spec­u­la­tion of fu­ture merg­ers within the fi­nan­cial in­dus­try given the re­cent com­pleted merger be­tween First Gulf Bank and Na­tional Bank of Abu Dhabi.

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