Global Indices & Markets News
Performances of Global Equity Markets
Global equity markets booked strong rebound last week as U.S. avoided falling into “fiscal cliff”. U.S. S&P500 Index, Japan Nikkei 225 Index and Hong Kong Hang Seng Index rose by 4.57 percent, 2.82 percent and 2.93 percent respectively.
U.S. Fiscal Cliff
U.S. Congress passed a bill to prevent "fiscal cliff" that will push U.S. economy back into recession. The vote avoided steep income-tax increases for a majority of Americans, but failed to resolve a major showdown over cutting the budget deficit, leaving investors and businesses with only limited clarity about the outlook for the economy. Read More: Alroy Commentary – The economy of Japan and Japanese Yen after the general election
Minutes From Fed
The minutes from the Fed's December policy meeting, released on Thursday, showed increasing reticence about adding to the central bank's $2.9 trillion balance sheet, which it expanded sharply in response to the financial crisis and recession of 2007-2009. Some policymakers thought asset buying should be slowed or stopped before the end of 2013 while others highlighted the need for further stimulus.
U.S. Labor Market
U.S. Nonfarm payrolls grew by 155,000 in December, meeting predictions but falling short of the levels needed to bring down the U.S. unemployment rate, which remained at 7.8 percent.
U.S. Manufacturing Sector
Manufacturing picked up in December, reflecting growth in orders, employment and exports that indicate the U.S. expansion will be sustained in 2013 following the budget deal. The Institute for Supply Management’s manufacturing index climbed to 50.7 from a three-year low of 49.5 in November.
China Manufacturing Sector
A gauge of China’s manufacturing showed a third month of expansion, adding evidence that the recovery in the world’s second-biggest economy will extend into the new year. The Purchasing Managers’ Index was 50.6 in December.
Japanese Yen touched new low against US dollar
The dollar traded close to 2 1/2 -year highs against the yen. U.S. Dollar touched 88.48 yen last Friday. The dollar posted a gain of around 2.7 percent against the yen last week, its biggest weekly rise in more than a year. Read More: Alroy Commentary – QE3 – Is it work?
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