Global Market Report - July 9

Chinese stock markets rebounded strongly at the start of the new trading week

Morningstar 10/07/2561

Global Market Report

Asia

Chinese stock markets rebounded sharply at the start of the new trading week as trade concerns eased for the time being and a fall in the US dollar gave some momentum to emerging market stocks. A rise in US markets on Friday after stronger job numbers also gave a push to Asia-Pacific equities

The Shanghai Composite Index, which entered a bear market in June, closed up nearly 2.5% and the CSI 300, which mimic the performance of Shanghai and Shenzhen indices, rose nearly 3%.

Hong Kong and Japan also gained but the rises were more modest than those seen in mainland China. Consumer gadget and tech firm Xiaomi made its IPO debut on the Hong Kong Stock Exchange but lost ground at the close.

Europe

The UK’s political real was rocked by the resignation of the Brexit Secretary David Davis overnight on Sunday. But both the pound and UK stock markets failed to show any signs of immediate panic. The FTSE 100, FTSE 250 and FTSE AllShare were modestly higher in morning trading but gains were modest in the absence of strong moves from company share prices. However, Mothercare (MTC) was off nearly 10% and led the FTSE AllShare fallers after announcing more closures.

It’s a busy week for corporate news, with updates from Ocado (OCDO), Marks & Spencer (MKS), Burberry (BRBY) and Barratt Development (BDEV).

The FTSE 100 was up around 16 points in midmorning trading at 7,634.

Eurozone exchanges followed the global trend and posted modest gains.

European Central Bank President Mario Draghi will address the European Parliament in a speech at 3pm Central European Time.

North America

US inflation figures on Thursday are expected to show a rise in the cost of living. The data is likely to feed into the Federal Reserve’s thinking about the timing of the next interest rate rise. The Fed meets next on the last day of July and makes its decision on interest rates public on August 1.

Earnings season kicks off properly this week with results from from heavyweights Citigroup (C), JP Morgan Chase (JPM) and Wells Fargo (WFC).

Canada’s central bank is expected to raise interest rates by a quarter point on Wednesday to 1.5%.

 

 

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