US equity markets were generally weaker in Friday trading, as stronger than expected employment data, increased the case for an earlier interest rate increase. However, the S&P 500 index is still only 2% below it’s all time high. Payroll data showed that wages increased on a year on year basis by the fastest rate since August 2013. Bond ‘proxies’ were notably weak with the Utilities sector down 1.7%, hitting the lowest level for seven months. Consolidated Edison was down 1.81%, Eversource Energy lost 1.58% and Wisconsin Energy fell 1.66%. A stronger $ also impacted consumer staple stocks, with Coca Cola down 1.2% and PepsiCo was down 1.1%. The Energy sector was more positive, with Nabors up 2.3% and Transocean up 3.3%.
Asia was mixed with Chinese equities closing at their highest level in 7 years boosted by the first day of trading in rail company, CRRC Corp. It was created by the merger between CSR Corp and China CNR Corp, the shares were limit up 10%. On an economic front, the Chinese data continued to be weak with May exports declining for a third straight month and imports down for a seventh straight month. By contrast, stronger than expected Japanese economic data showed that GDP growth was running at an annualised 3.9%, which will bring into question any expansion of the current QE programme. Toyota lost 1.3%, Dentsu was down nearly 4% and Japan Airlines declined 1.8%. Australian equities closed at their lowest level since mid January, with Metcash down 1.8% and Sundance Energy down 3.7%.
Europe is also weaker this morning and the German DAX index has now fallen 10% from the peak, which is classified as a correction. The blame lies mostly with the bond market, where German Bunds suffered their worst week since 1998. In corporate news, sweeping management changes at Deutsche Bank have seen the stock rise 6.3%. In the UK, stocks generally are little changed, although takeover rumours have boosted Diageo by 7.7% but hit Shire by 2.2%. Other movers include BT Group up 1.3%, Vodafone is 1.6% higher and AO World is up 1.2%.
Morning Spread 8th March 2017 European shares traded flat this morning, the modest moves masking significant results driven games by several companies on a bust day for European earnings.
Morning Spread 2nd November 2016 Asian stocks followed global equities lower despite gauges of manufacturing in China topping estimates and the Bank of Japan maintained its record stimulus program.
Morning Spread 1st November 2016 Asian stocks were mixed as declines in oil prices dragged energy shares lower and investor anxiety grew over next week’s US presidential election.
Morning Spread 28th October 2016 Asian stocks fell as oil explorers pushed down Hong Kong gauges, while investors digested earnings from several companies.
Morning Spread 27th October 2016 US stocks were mixed following the release of earnings from several companies.
Morning Spread 24th October 2016 US stocks were little changed as a record day for Microsoft and earnings from McDonald’s helped offset a fall in energy and healthcare shares.
Morning Spread 19th October 2016 Asian shares rose as a barrage of Chinese data confirmed the economy had stabilised on the back of government spending and a hot housing market, even if worries about debt continue to mount.
Morning Spread 10th October 2016 Asian stocks were mixed following the second US presidential debate between Hilary Clinton and Donald Trump.
Morning Spread 5th October 2016 Most Asian stocks outside Japan slid on concern central banks will reduce stimulus, while the Nikkei climbed after the yen weakened.
Morning Spread 27th September 2016 Asian stocks advanced with investors viewing Democratic candidate Hillary Clinton as having gotten the upper hand in the first US presidential debate.