European markets mixed as EU to decide on further Russia sanctions
European equity market traded in a mixed environment during the previous week, as several major indicators rose in value, while a number of gauges declined. The data for Germany was generally released worse than expected, including rising unemployment and falling inflation, while business climate in the country dropped amid possible negative impact from sanctions on Russia in the context of Ukrainian conflict.
The main European stock index, Eurostoxx 600, advanced in its total value by 0.5% to 342 points in course of five trading days, bringing the monthly performance to the green area and cutting the quarterly decrease. Among the leading industries, health care surged 1.5%, while travel and leisure and energy sectors followed with an advance, which amounted to 1% for each. Market leaders, however, were represented by telecommunications and financial industries, as Portugal Telecom SGPS SA jumped 16.9% to trade at 1.61 euro on Friday. Moreover, Eurazeo, a Paris-based investment company, added 12.1% to 57.83 euro during last five days. Opposite to the overall positive trend, Elekta AB plunged 9.6% to 79.65 kronor, capping the increase of the health care sector.
The British stock market showed a very similar trend with its pan-European counterpart, as the FTSE 100 Index climbed 0.7% to 6,819.75 points, while German DAX Index lost 0.4% to trade at 9.470/17 points at the market closing time last Friday.
U.S. shares traded unchanged as Q2 growth picked up
American stock market showed a distinct unwillingness to have any considerable trend during the trading week ended on August 29, as upward-corrected economic growth in the country was upset by falling personal spending and decreasing home sales. Moreover, core durable goods orders dropped the most since the beginning of the current year.
The benchmark S&P 500 Index traded up only 0.3% during the whole week, however, the gauge was able to breach a significant level of 2,000 points and closed above it at 2,003.37 points on Friday. Utility and telecommunications sectors leaded the gains, with both adding 1.2%. In general, all but two industries registered an increase in value, but industrials and consumer discretionary industries lost 0.7% and 0.05%, respectively. Among the best performing companies, Nabors Industries Ltd, an energy company, increased in value by 7.6% to $27.21, as it received a “buy” rating from twenty biggest rating agencies. Staples Inc followed with a 6.7% rise to $11,68, thus limiting the overall decline of the consumer discretionary sector, which it represents.
Other major market indexes, including Dow Jones Industrial Average and Nasdaq, jumped as much as 0.1% and 0.5% to 17,098.45 and 4,580.27 points, accordingly.
Japanese equities fell during August 25-29 trading week
The rally of the August 18-22 trading week was fully reversed to the opposite direction in course of the last week ended on August 29, when the Japanese stock market declined, showing the worst performance among four biggest equity markets around the globe. The negative sentiment was received from domestic news, as household spending in the country dipped further down, while unemployment level rose to 3.8%. At the same time, retail sales in Japan rose despite the negative analysts’ expectations.
The major Topix Index lost 1% to 1,277.97 points from Monday to Friday, pushing the monthly development to the red zone as well. The vast majority of sectors included in the gauge showed a considerable drop, with real estate and retail slipping 3.1% and 2.8%, respectively. The pharmaceutical industry, in turn, rose 1.7%, however, the overall climb was limited due to 10% decline in the value of Chugai Pharmaceutical Co Ltd to 3,295 yen. On the other hand, Nippon Conveyor Co Ltd, the manufacturer of industrial machinery, surged 44.9% to 239 yen, leading the weekly gain on the market.
The second-largest market index of Japan, the Nikkei 225, plummeted even more than its local counterpart, as it lost 1.2% to 15,424.59 in five trading days of the previous week.
Australian and Chinese markets declined as monthly gains erased
Companies of the Asia-Pacific region swung between gains and losses during the last trading week, while only the New Zealand’s market showed a positive tendency and others declined. As a result, monthly gains of all major indexes were decreased close to a zero growth. The stock market was negatively influenced by falling business confidence in Australia and New Zealand’s trade balance, which returned to the red zone.
The benchmark regional S&P/ASX 200 Index lost 0.2% to trade at 5,625.90 points at market closing time on Friday. Four out of ten largest sectors rallied in five days’ time, while others dropped considerably, with telecommunications and consumer staples losing 2.4% and 2.3%, respectively. At the same time, along with the European market, the gains were led by the health care industry. Among the best performers, Coalspur Mines Ltd rose 25% to A$0.06, as an Australia-based mining company received a permission to develop a new project in Canada. Transfield Services Ltd followed with a jump of 23.2% to A$1.75. The engineering services provider rebounded from previous year’s losses and improved its earnings in the second quarter of this year.
Among other market movers, Hang Seng slipped 1.69% to 24,742.06 points, while NZD 50 Index advanced 0.8% to trade at 5,223.30 points on August 29.
EXPLANATIONS
Indexes
Standard & Poor's 500 Index (S&P 500) or (SPX) - U.S. stock market index consisting of the 500 large-cap shares widely traded on the New York Stock Exchange and the NASDAQ.
Dow Jones Industrial Average Index (INDU) - U.S. stock market index consisting of the 30 large publicly owned U.S. companies , primarily industrials
NASDAQ Composite Index - U.S. stock market index representing all the stocks that are traded on the Nasdaq stock market, mostly technology and Internet-related
New Zealand Exchange 50 Gross Index (NZX 50) - stock market index consisting of the top 50 companies listed on the New Zealand Stock exchange
S&P/ASX 200 - a market-capitalization weighted stock market index of stocks listed on the Australian Securities Exchange from Standard and Poor’s
Hang Seng Index (HI) - Hong Kong’s stock market index consisting of 48 largest companies listed on the Hong Kong Exchange
Japan’s Nikkei Stock Average (Nikkei 225 Index) or (NKY) - Japanese stock market index consisting of the 225 largest companies listed on Tokyo Stock Exchange
FTSE 100 Index (UKX) - U.K. stock market index consisting of the 100 most capitalized U.K. companies trading on the London Stock Exchange
DAX Index (DAX) - German stock market index consisting of the 30 largest and most liquid German companies trading on the Frankfurt Stock Exchange
Eurostoxx 600 - stock market index, derived from the Stoxx Europe Total Market Index, consisting of 600 large, mid– and small-sized companies from 18 European countries
Chart
Correlation - statistical measure of the linear relationship between two random variables. It is defined as the covariance divided by the standard deviation of two variables.
Historical price changes - chart reflecting the historical price changes of particular region’s stock indices
Indicators
Industry performance - weekly performance of industries within the particular stock market index
Top performers - companies within a particular stock market index showing the best or worst weekly performance
Performance - relative historical change of stock market index value
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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