The morning market overview, compiled by Dow Jones Newswires:
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+++++ HOLIDAY NOTICE +++++
FRIDAY: There will be no trading in Tokyo due to a bank holiday.
+++++ DAILY THEME +++++
China has started the new year with a broadside against US defense contractors, responding to arms sales to Taiwan recently boosted by the Biden administration. In addition, Beijing once again warned President-elect Donald Trump about instruments that Beijing could use to protect national interests. China’s Commerce Ministry on Thursday added 10 companies to a blacklist of “unreliable companies” barred from doing business in China. To this end, it announced that it would exclude another 28 companies from purchasing unspecified components that can be used for both civil and military purposes. Most of the defense companies mentioned had previously been sanctioned by China and conduct little trade with the country, unlike some of the hundreds of Chinese companies with U.S. business that have been sanctioned by Washington, such as Huawei Technologies.
+++++ COMPANY OUTLOOK ++++++
No important dates announced
+++++ ECONOMIC OUTLOOK +++++
– US
16:00 ISM manufacturing index
FORECAST: 48.0 points
previously: 48.4 points
+++++ OVERVIEW INDICES +++++
INDEX level +/- %
E-Mini Future S&P 500 5,931.25 +0.2%
E-Mini Future Nasdaq-100 21,246.50 +0.4%
Nikkei-225 HOLIDAY
Hang Seng Index 19,697.50 +0.4%
Kospi 2,441.92 +1.8%
Shanghai Composite 3,220.34 -1.3%
S&P/ASX 200 8,250.50 +0.6%
+++++ FINANCIAL MARKETS +++++
EAST ASIA (HISTORY)
Inconsistent – Overall, the market is lacking trend-setting topics, it is said in the trade. In China, too, the stock exchanges do not show a uniform trend. The start of the year on the Chinese stock markets is one of the weakest in years. Retail stocks lead the list of losers on the mainland on Friday. Recently, economic data had once again underlined the sluggish economy. At the same time, weak data is boosting hopes for stimulus. According to a report, the People’s Bank of China plans to cut interest rates to an appropriate level in 2025. However, traders point out that government measures to stimulate the economy have so far disappointed investors. In South Korea, it is technology stocks that are giving the market tailwind. Amid the domestic political turmoil, the government has announced measures to make South Korea more attractive to foreign investors. Among the individual stocks, HD Hyundai Heavy Industries climbed 4 percent after an optimistic outlook. In Australia, the stock market is supported by the stimulus in China. However, the mining stocks Rio Tinto and BHP are in the red – the People’s Republic is an important buyer of Australian raw materials.
WALL STREET
INDEX last +/- % absolute +/- % YTD
DJIA 42,392.27 -0.4% -151.95 -0.4%
S&P 500 5,868.55 -0.2% -13.08 -0.7%
Nasdaq Comp. 19,280.79 -0.2% -30.00 -0.2%
Nasdaq-100 20,975.62 -0.2% -36.55 -0.2%
Thursday Tuesday
Turnover NYSE (stocks) 836 million 863 million
Winners 1,535 1,765
Losers 1,271 1,014
Unchanged 43 70
Just said – the very strong dollar had a braking effect. The background was new US economic data that was better than expected and underpinned the robust state of the US economy, which tends to argue against further falling interest rates. In any case, the US Federal Reserve had recently adopted a hawkish tone and announced a slower approach to further interest rate cuts. Tesla slipped 6.1 percent after the electric car maker missed expectations with its deliveries in the final quarter of 2024. In the Dow, Boeing (-2.9%) and Apple (-2.6%) were at the bottom. Apple was weighed down by concerns about declining iPhone sales, particularly in China, especially since Apple had also announced price reductions there, it said. However, the stock only reached a record high on December 26th. The recent disaster involving a 737-800 aircraft in South Korea continued to weigh on Boeing shares. The daily winners in the Dow were Nvidia (+3.0%), which, along with other semiconductor stocks, had fallen more significantly at the end of 2024. Synaptics increased by a good 8 percent. The software company is cooperating with Google (+0.1%) to improve artificial intelligence for the Internet of Things.
US BONDS
Maturity Yield Bp to VT Yield VT +/-Bp YTD
2 years 4.24 -0.0 4.24 0.3
5 years 4.37 -1.4 4.38 -1.2
7 years 4.47 -1.5 4.48 -1.5
10 years 4.56 -1.3 4.57 -1.1
30 years 4.78 -0.3 4.78 0.0
After a bit of a rollercoaster ride, bond yields ended the day a tad lower. The market had, among other things, played an inflationary policy under President-elect Donald Trump, which would make interest rate cuts more difficult, it said. The ten-year return was practically at a one-year high of 4.56 percent.
CURRENCY
last +/- % 00:00 Thu, 9:01 am % YTD
EUR/USD 1.0274 +0.1% 1.0266 1.0367 -0.8%
EUR/JPY 161.51 -0.1% 161.65 162.47 -0.9%
EUR/GBP 0.8286 -0.1% 0.8291 0.8278 +0.1%
GBP/USD 1.2400 +0.1% 1.2382 1.2521 -0.9%
USD/JPY 157.20 -0.2% 157.47 156.80 -0.1%
USD/KRW 1,467.09 -0.1% 1,468.90 1,467.90 -0.6%
USD/CNY 7.1970 -0.2% 7.2111 7.1902 -0.2%
USD/CNH 7.3331 -0.1% 7.3403 7.3236 +2.0%
USD/HKD 7.7788 +0.0% 7.7771 7.7754 +0.1%
AUD/USD 0.6218 +0.2% 0.6205 0.6206 +0.5%
NZD/USD 0.5608 +0.2% 0.5597 0.5608 +0.2%
Bitcoin
BTC/USD 96,618.55 -0.3% 96,862.95 95,707.90 +2.1%
With the prospect of a slower pace of interest rate cuts in the USA, the dollar rose sharply across the board, up almost 1 percent against the euro to $1.0264. This is the highest level in over two years.
++++ RAW MATERIALS +++++
OIL
most recently VT Settlem. +/-% +/- USD% YTD
WTI/Nymex 73.17 73.13 +0.1% +0.04 +2.0%
Brent/ICE 75.96 75.93 +0.0% +0.03 +1.5%
Oil prices rose by up to 1.9 percent. There was an upturn in Chinese demand in trade, also because China’s President Xi Jinping expressed confidence about the domestic economy in his New Year’s speech, it was said. In addition, reference was made to higher gas prices. In Europe, gas prices rose to a 14-month high amid low temperatures but also the halt in Russian gas deliveries to Europe through Ukraine. The fact that US oil inventories fell less sharply than expected last week did not matter, nor did the fact that gasoline inventories rose significantly.
METALS
last day previous +/- % +/- USD % YTD
Gold (spot) 2,659.16 2,658.20 +0.0% +0.97 +1.3%
Silver (spot) 29.61 29.63 -0.0% -0.01 +2.6%
Platinum (spot) 928.85 920.25 +0.9% +8.60 +2.4%
Copper future 4.03 4.03 -0.0% -0.00 -0.0%
Despite the strong dollar, the price of gold rose sharply, by almost $36 to 2,660 per troy ounce. Market expert Joseph Dahrieh from Tickmill spoke of promising prospects for the precious metal, which is considered a safe haven, and referred to ongoing geopolitical and economic uncertainties and continued gold purchases by central banks.
+++++ REPORTS SINCE THURSDAY 8:00 PM +++++
SOUTH KOREA
South Korean investigators have failed to arrest accused President Yoon Suk Yeol. An attempt was thwarted by his bodyguards. Yoon, who is under investigation for, among other things, rioting and is set to be removed from office, has rejected three requests to appear for questioning.
JP MORGAN
Following the departure of major US banks Morgan Stanley, Citigroup and Bank of America this week, JP Morgan could also leave the Net-Zero Banking Alliance. The bank is also considering withdrawing from the climate alliance, said a person familiar with the matter. Goldman Sachs and Wells Fargo had already left the United Nations-backed initiative in December.
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DJG/gos/err
(END) Dow Jones Newswires
January 03, 2025 01:47 ET (06:47 GMT)