HONG KONG (AFP) – Asian stocks were mixed yesterday, with no major movers on the last trading day of the year, closing out a period that has seen gains boosted by investors’ expectations of a (US) United States (US) Federal Reserve rate cut as early as March.
Tokyo finished 2023 with gains of 28.2 per cent for the calendar year, its best yearly performance since a decade ago.
Currency markets remained largely flat, but the US dollar is set to finish its worst year since the onset of the COVID-19 pandemic, with investors betting on a Fed rate cut and that other countries might keep rates higher for longer.
Asian stocks are on track for their best year since the pandemic but continue to under perform global peers.
Chinese markets, in particular, have been weighed down by concerns regarding the country’s sluggish economic recovery from its long-lasting and strict pandemic lockdowns.
Still, there was positive news in the Chinese tech sector yesterday, with Huawei saying it expected 2023 revenue to grow by nine per cent, despite facing continuing US sanctions.
European stocks opened on the front foot, with London, Paris and Frankfurt all climbing.
On Thursday, the Dow eked out a fresh record, while the S&P 500 fell a bit short of an all-time high despite finishing the day with modest gains.
US equities have trended higher since late October as the market has embraced moderating inflation and a strong labour market in the belief the US economy can avoid recession.
Data from the US Department of Labor on Thursday showed a slight increase in unemployment claims. The level remains low by historic standards, however.
Analysts said they expected year-end market activity to continue to be positive, but within a relatively thin band of trading volumes.
“Investors appear satisfied to let the market slide sideways into year-end, with sellers already done,” said investor Louis Navellier in a note.
Global oil prices have stabilised after worries regarding Red Sea shipping disruptions eased this week, following the formation of a US-led naval coalition to police the route against attacks by Yemen’s Houthi rebels.
US oil prices fell more than three per cent despite a weekly inventory report that showed lower stocks of crude oil and gasoline.
Gold retreated from its recent rally in yesterday‘s trade, down 0.8 per cent from its highest level a day earlier.
