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Asian markets showed mixed performance Thursday amid thin holiday trading, with most regional exchanges closed for Christmas. The Tokyo-based Nikkei 225 edged down marginally by less than 0.1% to 50,317.43, though the index has posted impressive gains of nearly 30% for the year.
In currency markets, the dollar weakened slightly against the Japanese yen, falling to 155.70 from 155.94, while the euro remained steady at $1.1780.
Mainland Chinese markets advanced, with the Shanghai Composite index climbing 0.3%, buoyed by encouraging statements from the People’s Bank of China. The central bank pledged to ensure adequate money supply to support financing, economic growth, and inflation targets. This announcement came days after the PBOC opted to maintain its key short-term lending rates, signaling policy continuity. Hong Kong’s exchange remained closed for the holiday.
Elsewhere in the region, shares declined in Thailand and Indonesia as trading volumes remained subdued throughout Asia.
In the United States, markets closed early on Wednesday for Christmas Eve and remained shut on Thursday for Christmas Day. During Wednesday’s abbreviated session, the S&P 500 index rose 0.3% to 6,932.05, while the Dow Jones Industrial Average gained 0.6% to finish at 48,731.16. The tech-heavy Nasdaq composite added 0.2%, reaching 23,613.31.
Trading activity was exceptionally light, with only about 1.8 billion shares changing hands on the New York Stock Exchange—roughly one-third of the typical daily volume. While U.S. markets will resume full-day trading on Friday, volumes are expected to remain subdued as most investors have already settled their positions for the year.
The S&P 500 has delivered robust performance in 2023, rising more than 17%. Investors have responded positively to the Trump administration’s deregulatory policies and shown optimism about artificial intelligence’s potential to boost corporate profits across various sectors, extending beyond just technology companies.
Market analysts suggest that investor focus in the coming weeks will center on the U.S. economic trajectory and Federal Reserve policy decisions. Current market sentiment indicates expectations that the Fed will maintain interest rates at their current levels during its January meeting.
Recent economic data has painted a complex picture. The U.S. economy expanded at a surprisingly strong 4.3% annual rate in the third quarter—its fastest pace in two years—driven by resilient consumer spending despite persistent inflation. However, some indicators point to emerging challenges, including declining consumer confidence due to high prices, a gradually cooling labor market, and weakening retail sales.
Labor Department data released Wednesday showed U.S. unemployment benefit applications decreased by 10,000 to 214,000 for the week ending December 20, down from 224,000 in the previous week. This figure came in below economists’ expectations of 232,000 new claims, suggesting the job market remains relatively stable despite some signs of softening.
In corporate news, Dynavax Technologies saw its stock soar 38.2% after French pharmaceutical giant Sanofi announced plans to acquire the California-based vaccine maker in a $2.2 billion deal. The acquisition will add Dynavax’s hepatitis B vaccines to Sanofi’s portfolio, along with a shingles vaccine still in development.
Novo Nordisk shares increased 1.8% following U.S. regulatory approval for a pill version of its blockbuster weight-loss drug Wegovy. Despite this positive development, the Danish pharmaceutical company’s stock has declined nearly 40% this year amid intensifying competition in the weight-loss medication market, particularly from rival Eli Lilly, whose shares have climbed 40% year-to-date.
In energy markets, U.S. crude oil settled at $58.35 per barrel, while Brent crude, the international benchmark, finished at $61.80 per barrel.
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10 Comments
The resilience of the Nikkei and Shanghai Composite in the face of thin trading is encouraging. Japan and China are key players in the global commodities and energy markets, so their economic health is relevant for mining and energy investors.
I’m curious to see how the US markets perform once regular trading resumes after the holidays. The drifting to new records during a slow week suggests strong underlying momentum, but the true test will be how it holds up in the new year.
The continued strength in US stocks, even during the holiday week, is quite remarkable. I wonder if this reflects broader economic optimism or just thin trading conditions. Curious to see if the momentum can be sustained in 2023.
The early close and holiday shutdowns in the US probably contributed to the market drifts. It will be interesting to see how trading volumes and sentiment evolve once regular sessions resume.
The PBOC’s policy moves are definitely worth watching closely. Ensuring adequate money supply could have implications for inflation, interest rates, and the broader economic outlook – all of which are crucial for commodity and energy companies.
The mixed performance across Asian markets highlights the diverse dynamics at play in the region. Investors in mining, metals, and energy will want to closely monitor the economic and policy developments in the major economies like China and Japan.
The weakness in Thai and Indonesian shares is noteworthy, even with the subdued trading across Asia. Are there specific economic or political factors weighing on those markets, or is it just a broader regional dynamic?
The holiday lull could certainly be a factor, but it’s worth looking into any country-specific developments that may be impacting those Southeast Asian exchanges. Regional dynamics are important to monitor.
Interesting to see the mixed performance in Asian markets, with the Nikkei and Shanghai Composite showing some gains despite the thin holiday trading. Curious to see how the Chinese central bank’s policy moves will impact the economy going forward.
The PBOC’s pledge to ensure adequate money supply is an encouraging sign for economic growth and inflation targets. It will be important to monitor how these policies play out in the new year.