Equities Weekly: Trump’s policy unclarity dampens risk appetite

Over the week, global equity markets wrapped up with a modest uptick of 0.11 per cent as markets stopped to digest the details of Donald Trump’s first press conference since his election victory.

The US’s S&P 500 Index receded by 0.43 per cent as Trump provided little clarity over his administration’s fiscal policies. Other developed markets like Europe’s Stoxx 600 and Japan’s Nikkei 225 Index performed better as both indices notched individual gains of 0.63 per cent in the past week.

Asian markets continue to chart their growth trajectory as the MSCI Asia ex Japan Index surged by 1.55 per cent.

However, this growth was not uniformly reflected in the Chinese equity market.

China’s offshore equity market, represented by the HSML 100 Index, expanded by 1.57 per cent, while its onshore counterparts — the Shanghai Composite Index and the Shanghai Shenzhen CSI 300 Index — retreated by 1.18 and 0.69 per cent respectively.

Additionally, other neighbouring East Asian markets like Hong Kong’s HSI Index, Taiwan’s TWSE Index and Korea’s KOSPI Index all posted positive gains of 1.6, 1.14 and 3.04 per cent respectively.

Across the South China Sea, mixed performances were seen over in South East Asian markets.

Both Singapore’s Straits Times Index and Thailand’s SET Index saw growth rates of 2.34 per cent and 0.75 per cent respectively over the week, in contrast to the decline experienced by Malaysia’s KLCI Index and Indonesia’s JCI Index of 0.18 and 1.63 per cent respectively.

Emerging market equities, represented by the MSCI Emerging Markets Index, rose by 1.36 per cent over the week, supported by India’s SENSEX Index and Brazil’s Bovespa Index, which clocked gains of 1.46 per cent and 3.19 per cent respectively.

On the other hand, following the slide in crude oil prices by 3.32 per cent (represented by the WTI Crude Oil Index), Russia’s RSTI$ Index fell correspondingly by 1.55 per cent as the market continues to be dominated by oil and energy heavyweights. Singapore: Lacklustre retail sales lifted by motor vehicles

Singapore’s retail sales for the month of November 2016 grew by 1.1 per cent year-on-year, driven by a strong demand in motor vehicles, which surged 17 per cent year-on-year.

Excluding the sales of motor vehicles, however, retail sales were down by 2.1 per cent, the tenth straight month of contraction, with only sellers of medical goods & toiletries, recreational goods and optical & books posting year-on-year improvements. The main laggards included telecommunications and computer (13.5 per cent), watches & jewellery (six per cent), wearing apparel & footwear (4.4 per cent) and furniture & household equipment (3.9 per cent).

While the industry may benefit from the seasonal uptick arising from festive seasons in the short-term, it remains to be seen if retail sales can be sustained throughout the whole of 2017. Taiwan: December export growth hits four-year high

Taiwan’s exports in December 2016 rose 14 per cent yearon-year, better than the consensus estimate of 10.4 per cent and the previous month’s reading of 12.1 per cent.

Exports have grown for three consecutive months, with December’s growth rate the largest expansion since February 2013. Yet, data has shown that full-year exports have continued to contract for the second year in a row, as exports decreased by 1.7 per cent, while imports dropped off by 2.6 per cent.

The export-oriented Taiwanese economy is likely to continue its recovery trajectory in the first quarter of 2017, with the help of a low base effect, rebounding commodity prices and an improving demand for semiconductors.