Global Market Report - December 31

Most stock markets are set to close 2018 at a loss, with the Dow Jones on track for a 10% fall for December, the biggest one-month percentage fall since 2009

Morningstar 02/01/2562

Global Market Report


Stock markets in Japan are closed for public holidays. The Nikkei index made its first annual loss for seven years in 2018, down around 15% after a strong performance in previous years.

Today’s China manufacturing PMI suggests that the sector has just started to contract, with the index dipping below 50. The Caixin manufacturing PMI is released on Wednesday.

China’s Shanghai Stock Exchange is closed today, and the Composite Index is down over 25% this year.

Hong Kong’s Hang Seng closed the day up 1.34% from the previous session, ending the year at 25,845 points – having started 2018 at 30,515 points.


The London Stock Exchange closes early today for New Year’s Eve. The FTSE 100 is on track for a loss of 12% for the year. Given the challenges faced by UK stocks – Brexit, global market volatility, trade disputes – traders may take the view that this loss could have been worse. The May high of 7,900 points seems a long time ago, and the index is now 1,200 points lower at 6,700.

Ocado (OCDO), the biggest gainer in the FTSE 100 this year, is the top riser on Monday morning. Following HMV's demise over the festive period, the UK's retailers announce their trading updates at the end of this week and in the coming weeks.

The UK manufacturing PMI is due on Wednesday, the first of the PMI indices to be released – the closely watched services index is out on Friday.

Frankfurt’s Stock Exchange is closed for the day and like other indices, the DAX has had an unimpressive year, shedding 18% in 2018.

North America

US stock futures suggest an opening gain for the stock market at the open on Monday. For 2018, the Dow Jones is set for a fall of around 1,656 points, or 6.7%, the worst since 2008. The quarterly loss of just under 13% is the worst since the first quarter of 2009. The index is off nearly 10% for December, the biggest one-month percentage decline since February 2009.

The S&P 500 is down 7%, the worst since 2008, and the Nasdaq Composite is 4.6% lower – although tech volatility has been more pronounced than the headline number.

Friday’s non-farm payrolls will be the highlight of an otherwise sparse economics calendar. The US economy is expected to have added 185,000 jobs in December, an increase of 30,000 roles from the month before. However, November’s payrolls came in short of expectations so there is always scope for disappointment – although last time the stock market took the shortfall in its stride. The unemployment rate is expected to remain steady at 3.7% although the rise in average hourly earnings is forecast to dip to 3% on an annual basis.

US inflation numbers are due on Friday, 11 January.

Canada’s December unemployment numbers are released on Friday, following Wednesday’s manufacturing PMI figures.


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