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Markets

Global Markets Report - 30 November

ASX set to open higher, after a mixed day for US major indices and bond yields continued to move lower.


Australia

Australian shares are set to open higher, after a mixed day for US major indices and bond yields continued to move lower.

ASX futures were up 0.1% or 5 point as of 8:30am on Thursday, suggesting a higher open.

Major US stock averages closed little changed again after economic data support bets on a soft landing for the economy and investors increasingly expect rate cuts next year.

DJIA gained 13 points to 35430, while the S&P 500 lost 4 points to 4550 and the Nasdaq slipped 23 points to 14258.

In commodity markets, Brent crude oil rose 1.7% to US$83.05 a barrel while gold was up 0.2% to US$2,044.43.

In local bond markets, the yield on Australian 2 Year government bonds was down at 4.09% while the 10 Year yield was also down at 4.36%. US Treasury notes were down, with the 2 Year yield at 4.64% and the 10 Year yield at 4.26%.

The Australian dollar hit 66.12 US cents down from the previous close of 66.48. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was up at 97.52.

Asia

Chinese shares closed lower as concerns over the property sector weighed on real estate stocks. Without any consistent sales recovery, financing support, such as the expected property white list for bank financing, can only provide marginal support to property companies in need, Citi analysts said in a research note. China Vanke dropped 2.5% and Poly Developments & Holdings Group was 3.9% lower. Insurance stocks also declined with China Life Insurance falling 1.8% and Ping An Insurance shedding 2.2%. Meanwhile, China Mobile gained 0.3%. The benchmark Shanghai Composite Index ended 0.6% lower at 3021.60, the Shenzhen Composite Index declined 0.8% and the tech-heavy ChiNext Price Index slipped 1.1%.

Hong Kong shares closed lower as investors digested the last batch of major earnings and comments from U.S. Fed officials. Major tech names led falls. Meituan fell 12% as guidance for slowing growth in the final months of the year outweighed solid 3Q earnings. Alibaba dropped 2.2% and JD.com was down 1.6%. Auto stocks also weighed on the market, with BYD down 3.3% and Li Auto dropping 3.4%. Materials stocks were the sole sector that gained in the session, with Zijin Mining Group up 3.6% and Shandong Gold Mining 3.1% higher. The benchmark Hang Seng Index declined 2.1% to 16993.44. The Hang Seng Tech Index was 2.25% lower.

The Nikkei Stock Average edged 0.3% lower to close at 33321.22 amid JPY strength, which hurts the overseas earnings of Japanese exporters when repatriated to Japan. Losses were somewhat limited by possible bargain-hunting interest and position adjustments. Among worst performers on the benchmark index, Seven & i Holdings fell 3.8%, Kawasaki Kisen Kaisha dropped 3.25% and Mizuho Financial Group shed 3.1%. Meanwhile, Taisho Pharmaceutical jumped 16% in a third session of strong gains after the drugmaker's management offered to buy out the company. USD/JPY was at 147.22, markedly down from 148.27 as of Tuesday's Tokyo stock-market close. The 10-year JGB yield was down 7.5 bps at 0.675%.

Indian shares ended higher as U.S. Fed officials' dovish comments boosted investors' belief the Fed is done hiking interest rates. IT stocks led gains due to their exposure to the U.S. market. Tech Mahindra gained 1.5% and Wipro was 2.3% higher. Financial services stocks also lifted the market, with HDFC Bank rising 1.9% and Axis Bank adding 3.9%. Food-delivery platform Zomato advanced 2.55% after Alipay, owned by China's Ant Group, said it will sell a 3.44% stake in Zomato. Nestle India dropped 0.6% and Titan Co. was 0.5% lower. The benchmark Sensex ended 1.1% higher at 66901.91.

Europe

European stocks mostly rose as slower German inflation boosted market spirits. The DAX rallied 1.1% following the inflation figures, while the Stoxx Europe 600 advanced 0.5% and the CAC 40 gained 0.2%, though the FTSE 100 dropped 0.4%. "European markets have lagged behind US counterparts of late, but today's German inflation slowdown has provided the boost the DAX and others were looking for," IG analyst Chris Beauchamp wrote. "This means eurozone inflation data seems to be heading in the same direction as the US, giving the ECB some latitude in its monetary-policy approach. Once more it's the FTSE 100 left behind by its peers. The lack of any continued rebound this year speaks to ongoing disillusion among global investors regarding the UK economy's prospects."

The FTSE 100 closed Wednesday down 0.43%, an improved performance over yesterday but still behind its European peers which broadly ended the session in the green. A mixture of stocks—containing some heavyweight names like HSBC—have taken the index lower, IG Group chief market analyst Chris Beachamp says in a research note. A rallying pound won't help matters, but the lack of any continued rebound this year speaks to continued disillusion among global investors regarding the prospects of the U.K. economy, Beauchamp says. HSBC ended the session down around 2%.

North America

Major US stock averages closed little changed again after economic data support bets on a soft landing for the economy and investors increasingly expect rate cuts next year.

DJIA gained 13 points to 35430, while the S&P 500 lost 4 points to 4550 and the Nasdaq slipped 23 points to 14258.

US GDP came in at a 5.2% annual rate for 3Q, the fastest quarterly growth rate since late 2021. Fed's beige book shows the economy seems to be cooling, noting some softening in the labor market.

Some of the year's big gainers lost some steam with Meta Platforms losing 2% and Tesla falling 1%.

Oil prices rose ahead of OPEC+ meeting tomorrow, but failed to lift energy stocks.



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