Global stocks little changed as UK parliament votes to seek Brexit delay

  • 15 Mar 2019

    Global stocks little changed as UK parliament votes to seek Brexit delay

    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.

    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
      End 2019DailyPercent Change
     Index2018Mar 13Mar 14ChangeDaily2019Yr/Yr
    North America                
    United States Dow 23327.46 25702.9 25709.94 7.05 0.0 10.2 3.4
      NASDAQ 6635.28 7643.41 7630.91 -12.50 -0.2 15.0 2.0
      S&P 500 2506.85 2810.92 2808.48 -2.44 -0.1 12.0 2.2
    Canada S&P/TSX Comp 14322.86 16150 16087.55 -62.42 -0.4 12.3 2.7
                     
    Europe                
    UK FTSE 100 6728.13 7159.19 7185.43 26.24 0.4 6.8 0.6
    France CAC 4730.69 5306.38 5349.78 43.40 0.8 13.1 1.6
    Germany XETRA DAX 10558.96 11572.4 11587.47 15.06 0.1 9.7 -6.1
    Italy MIB 18324.03 20749.2 20877.43 128.23 0.6 13.9 -8.1
    Spain Ibex 35 8539.90 9192.7 9209.8 17.10 0.2 7.8 -4.9
    Sweden OMX Stockholm 30 1408.74 1572.8 1590.76 17.96 1.1 12.9 -0.1
    Switzerland SMI 8429.30 9387.43 9481.9 94.47 1.0 12.5 6.8
                     
    Asia/Pacific                
    Australia All Ordinaries 5709.44 6246.01 6266.79 20.78 0.3 9.8 4.0
    Japan Nikkei 225 20014.77 21290.2 21287.02 -3.22 0.0 6.4 -2.4
      Topix 1494.09 1592.07 1588.29 -3.78 -0.2 6.3 -8.9
    Hong Kong Hang Seng 25845.70 28807.5 28851.39 43.94 0.2 11.6 -8.5
    S. Korea Kospi 2041.04 2148.41 2155.68 7.27 0.3 5.6 -13.5
    Singapore STI 3068.76 3195.59 3197.92 2.33 0.1 4.2 -9.1
    China Shanghai Comp 2493.90 3026.95 2990.68 -36.27 -1.2 19.9 -9.1
    Taiwan TAIEX 9727.41 10373.3 10348.65 -24.67 -0.2 6.4 -6.1
    India Sensex 30 36068.33 37752.2 37754.89 2.72 0.0 4.7 12.1

    Data Source — Haver Analytics

    Bond markets
    10-Yr Govt BondsClosing YieldChange Yield (bp)
    US 2.63% 1
    UK 1.22% 3
    Germany 0.08% 2
    Japan -0.05% 0
    Australia 1.97% 1

    Source — Bloomberg

    Currencies and commodities
    Currency13-Mar14-MarChange (%)
    Japanese yen 111.12 111.69 -0.5%
    Australian dollar 0.7095 0.7066 -0.4%
    Yuan 6.7071 6.7230 -0.2%
    Euro 1.1334 1.1302 -0.3%
    British pound 1.3261 1.3226 -0.3%
    Swiss franc 1.0029 1.0041 -0.1%
    Canadian dollar 0.7520 0.7505 -0.2%

    Source — Bloomberg 

    CommoditiesMar 14Change
    Brent Spot $67.14 -0.61%
    Gold $1,295.90 ($13.40)
    Thompson-Reuters/ Jeffreys Commodity index 190.97 -0.01%

    Source — Bloomberg