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Global stock market rally has further to run in 2020 – Reuters poll

  
Analysis, Global Indices
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But much depends on the US-China trade war still

Poll

The bias has turned more favourable in the most recent poll with a slim majority of respondents (53/102) viewing that risks to the outlook are now skewed more to the upside.

In comparison, just three months ago, a clear majority of respondents (69/97) viewed that risks to the outlook were skewed more to the downside instead.
A lot of this of course owes to the more optimistic US-China trade rhetoric, as both countries look to move closer towards a trade truce by the end of this year.
Among those who answered an additional question in the poll, 50 respondents said the bull run in the stock market will end within a year with 40 respondents saying that it would within the next two years.
That shows that sentiment is leaning more towards the bull run still going strong although I reckon its strength may not be as what we are seeing this year.
I mean with stretched valuations, flagging global growth and more political uncertainty i.e. US elections all at play next year, the S&P 500 may find it tough to post another 25% year like this one and so will its peers.

Nikkei 225 closes higher by 0.28% at 23,437.77

  
Analysis, Global Indices

The Nikkei continues its good run amid mixed mood in Asian equities

Nikkei 27-11

Japanese stocks push higher again today, helped by continued optimism in the US-China trade rhetoric with US officials claiming that a deal is “very close” now. And that is also helping to keep markets cautiously optimistic over the past few days.

Elsewhere in Asia, the Hang Seng and Shanghai Composite are both down by 0.1% though – owing to weaker Chinese data as industrial profits slumped to a eight-year low.
The overall risk mood remains more balanced though with US futures and bond yields sitting more flat on the day. USD/JPY is mildly higher at 109.16 with the dollar holding light gains as we begin European morning trade.

European indices mostly higher to end the week

  
Analysis, Global Indices

Italy’s FTSE MIB ends marginally lower

The major European indices are ending the week mostly higher. The exception is the Italy’s FTSE MIB which fell marginally.
The provisional closes are showing:
  • German DAX, +0.2%
  • France’s CAC, +0.1%
  • UK’s FTSE 100, +1.2%. The gain was the best in nearly 4 months
  • Spain’s Ibex, +0.4%
  • Italy’s FTSE MIB, -0.1%
  • Portugal’s PSI 20, +0.15%
For the week, apart from the UK FTSE 100 which turn positive as a result of today’s sharp move higher, the other indices had declines for the week.
  • German DAX, -0.59%
  • France’s CAC, -0.8%
  • UK’s FTSE 100, +0.35%
  • Spain’s Ibex, -0.12%
  • Italy’s FTSE MIB, -1.3%

Nikkei 225 closes higher by 0.32% at 23,112.88

  
Analysis, Global Indices

The Nikkei closes higher amid mixed mood in Asian trading

Nikkei 22-11

Japanese stocks managed to find a reprieve to end the week but the overall mood remains more mixed as traders and investors are still caught in the middle of trying to figure out how US-China trade talks are developing at the moment.

The Hang Seng is also seeing mild gains of 0.2% but the Shanghai Composite is down by 0.7% on the day currently.
The overall risk mood remains more flat/modest as we look towards European trading with US futures up 0.1% but Treasury yields are flat across the curve. USD/JPY is also seeing little change at 108.61, trapped in a 14 pips range so far today.

Major European indices ending the session lower

  
Analysis, Global Indices

But off the session lows

The major European indices are ending the session lower. That is the bad news. The good news is some of the major indices are well off their session lows and closing near session highs.
The provisional closes are showing:
  • German DAX, -0.04%. The low for the day extended to -1.13%
  • France’s CAC, -0.2%. It’s low reached -0.84%
  • UK FTSE 100, -0.80%. It traded as low as -1.43%
  • Spain’s Ibex, -0.4%. The low reached -1.0%
  • Italy’s FTSE MIB bucked the trend and close higher by 0.1%.  The low reached -0.77%

In the European debt market, the benchmark 10 year yields are ending mostly lower (the exception is the Portugal 10 year).

The European 10 year yields are mostly lowerIn other markets as European/London traders look to exit:
  • spot gold is trading down $5.02 or -0.34% at $1467.35
  • crude oil is trading up $1.74 or 3.15% at $56.95. The price rebounded after the build was less than expectations
In the forex, the major currencies have shuffled the strongest and weakest rankings.
The US dollars now the strongest currency of the day, rising against all the major currencies. The JPY has moved off that level after stocks rebounded off session lows.  The AUD has supplanted the NZD as the weakest. The AUDUSD just move below its 100 hour moving average at 0.68063 and the low for the day at 0.6800. It is currently trading at 0.6797.   The  USDCAD has had a down and up North American session after basing near its 200 day moving average at 1.3274 and moving back higher.

US Treasury 10-year yields slip to fresh two-and-a-half week lows

  
Analysis, Global Indices

10-year yields fall by 5 bps to 1.733%, lowest level since 4 November

USGG10YR vs Gold

Risk-off flows continue to feed through into markets and that is seeing bonds gain further on the day as we begin European trading.
In turn, this is also fueling gains in gold with price now up by 0.4% just above $1,478.
As mentioned earlier, with little else on the economic calendar, the risk mood will be the key driver affecting markets in trading today. So far, there doesn’t appear to be much change in sentiment since Asia Pacific trading.
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