On 14 March 2019 - Global stocks little changed as UK parliament votes to seek Brexit delay

Anne D Picker

Anne D Picker - Econoday

Data point to slower output growth in China, subdued inflation in Europe, and solid US labour market.

US markets

US stocks with little changed Thursday with data and other market-moving news limited. The Dow closed flat on the day, while the S&P and Nasdaq fell 0.1 percent and 0.2 percent respectively. Facebook fell after users were unable to access its online services for several hours, while Apple extended recent gains after a broker upgraded its outlook for the company.

Jobless claims data showed a small increase in initial claims in the March 9 week but the 4-week average fell for the third week in a row, providing an early indication that the monthly employment report will show strong labour market conditions in March. New home sales fell 6.9 percent on the month in January, close to the consensus forecast, but the 3-month average for this volatile series has improved to its best rate since June. The median sale price is down 3.8 percent on the year, suggesting that growth in sales has been supported by discounting.

These data reflect observations at 4:00 PM US ET. Gold fell US$13.40 to US$1,295.90 while dated Brent spot crude lost US$0.41 to US$67.14. The US dollar made moderate gains against all other major currencies. The yield on the US Treasury 30-year bond rose 3 basis points to 3.04 percent while the 10 year note rose 1 basis point to 2.63 percent.

European markets

European markets closed higher Thursday after the UK parliament voted Wednesday against leaving the European Union without a deal in place and ahead of another vote that was expected to seek a delay to withdrawal. The FTSE advanced 0.4 percent, the CAC outperformed with an increase of 0.8 percent, and the DAX rose 0.1 percent.

As expected, the UK parliament late Thursday voted for a delay in the UK’s withdrawal from the European Union, scheduled to take place at the end of the month. The UK government will now submit a request to the European Union for a delay. This will need to be approved by all member countries. Prime Minister Theresa May has indicated that she will try again next week to secure parliament’s approval for her Brexit deal, arguing that this approval will be necessary to prevent an extended delay to withdrawal.

German inflation data confirmed price pressures remained muted in February. The consumer price index rose 0.4 percent on the month after increasing 0.5 percent in January, with the inflation rate picking up for the first time since October from 1.4 percent to 1.5 percent. Food and fuel prices both contributed to this increase in the headline inflation rate though the core measure of inflation also rose, from 1.3 percent to 1.4 percent.  The HICP measure rose 0.5 percent on the month and 1.7 percent in February, matching the inflation rate recorded in January.

French consumer prices were steady in February, with the index flat for a second consecutive month and the inflation rate picking up slightly from a revised 1.2 percent to 1.3 percent. This is the first increase in inflation since July but is still the second weakest print since February last year. Food and energy prices both rose at a faster pace but prices for manufactured goods and services were weaker, resulting in the core inflation rate holding steady at 0.7 percent. The HICP measure rose 0.1 percent on the month and 1.5 percent in February, up from 1.6 percent in January.

Asia Pacific Markets

Most Asian indices were little changed Thursday with the exception of the Shanghai Composite index, down 1.2 percent after the release of data showing weaker Chinese industrial production growth in the first two months of the year. Australia’s All Ordinaries index and Korea’s Kospi index were the biggest movers elsewhere in the region, both closing up 0.3 percent.

Chinese data published Thursday showed mixed results for key activity indicators for the first two months of the year (separate year-on-year data for the months of January and February are not published because of the impact of differences in the timing of lunar new year holidays). Industrial production grew 5.3 percent on the year for January and February combined, down from 5.7 percent in December and below the consensus forecast of 5.5 percent. Weaker output growth in the utilities and mining sectors drove this fall in headline growth, with manufacturing output increasing at a slightly faster pace. Retail sales grew 8.2 percent on the year in January and February combined, unchanged from December and in line with the consensus forecast, with a smaller fall in sales of automobiles and a rebound in sales of communication equipment offset by weaker sales of household non-durables and home appliances. Fixed asset investment grew 6.1 percent on the year for January and February combined, up from 5.9 percent in December and above the consensus forecast of 5.9 percent.

India's wholesale price index increased by 2.93 percent on the year in February, up from 2.76 percent in January, mainly reflecting the impact of stronger increases in food and fuel prices. This is broadly in line with data released earlier in the week that showed an increase in headline consumer inflation from 2.05 percent in January to 2.57 percent in February, still close to the bottom of the Reserve Bank of India's target range of 2.0 percent to 6.0 percent.

Looking forward

The Bank of Japan is expected to leave policy settings unchanged at the end of its policy meeting Friday. The European data calendar is relatively light while industrial production and consumer sentiment data are the main highlights in the US.

Global Stock Markets

 

Index

Mar 14 2019

Daily Change

% Change Daily

North America

United States

Dow

25709.94

7.05

0.0

 

NASDAQ

7630.91

-12.50

-0.2

 

S&P 500

2808.48

-2.44

-0.1

Canada

S&P/TSX Comp

16087.55

-62.42

-0.4

Europe

UK

FTSE 100

7185.43

26.24

0.4

France

CAC

5349.78

43.40

0.8

Germany

XETRA DAX

11587.47

15.06

0.1

Italy

MIB

20877.43

128.23

0.6

Spain

Ibex 35

9209.8

17.10

0.2

Sweden

OMX Stockholm 30

1590.76

17.96

1.1

Switzerland

SMI

9481.9

94.47

1.0

Asia/Pacific

Australia

All Ordinaries

6266.79

20.78

0.3

Japan

Nikkei 225

21287.02

-3.22

0.0

 

Topix

1588.29

-3.78

-0.2

Hong Kong

Hang Seng

28851.39

43.94

0.2

S. Korea

Kospi

2155.68

7.27

0.3

Singapore

STI

3197.92

2.33

0.1

China

Shanghai Comp

2990.68

-36.27

-1.2

Taiwan

TAIEX

10348.65

-24.67

-0.2

India

Sensex 30

37754.89

2.72

0.0

*Markets closed
Source — Haver Analytics

Note: all releases are listed in local time.

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