World stocks on Tuesday closed out a notably profitable year, with Wall Street recording its best annual performances since 2013, boosted by hopes for a US-China trade deal.
New York rallied into the close, turning positive for the day and leaving the broad-based S&P 500 and tech-heavy NASDAQ Composite up 29 percent and 35 percent respectively for last year, the best showings in six years.
Key European markets showed increases of 25 percent or more for last year, partly thanks to late surges on receding recession fears and easing China-US trade tensions.
However, Brexit-hit London trailed its peers with a 12 percent annual rise, less than half the percentage increase managed by Paris, Frankfurt and Milan.
Earlier on Tuesday as US markets were about to open, US President Donald Trump tweeted that a partial trade deal with China would be signed in Washington on Jan. 15, ending some of the uncertainty about efforts to cement the deal announced early last month.
Prudential Financial Inc market strategist Quincy Krosby told reporters that the US-China detente could help decide the direction of the global economy next year.
“Much of the enthusiasm in the market is based on the idea that global growth is going to begin to accelerate, albeit slowly,” she said. “The question will be: Do we actually see positive growth, especially in China?”
Demand in China is crucial to chances for growth in global trade, while a China trade agreement could see US corporations begin investing again after a year when corporate capital spending stagnated worryingly, Krosby said.
Asian stock markets closed mainly lower on Tuesday, with Hong Kong’s Hang Seng Index ending a half-day of trading almost 0.5 percent down, although it rallied more than 7 percent last month. Tokyo was shut for a public holiday.
“While market volumes are predictably light, investors continue to strike a year-end cautionary tone as December optimism is gradually giving way to 2020’s uncertainty,” AxiTrader Ltd chief Asia market strategist Stephen Innes said in a client note.
Asian investors were also watching for significant policy announcements early in the New Year.
In a New Year’s speech yesterday, North Korean leader Kim Jong-un struck a decisively militaristic tone, warning of a new strategic weapon and “shocking” action.
Analysts said all eyes were on nuclear-armed Pyongyang’s threat of a “new way” after its end-of-year deadline for sanctions relief from the US expired.
An address by Chinese President Xi Jinping (習近平) would be followed closely.
Elsewhere on Tuesday, oil prices slid, despite reports that Iran had seized a vessel suspected of smuggling fuel near the Strait of Hormuz — a chokepoint for one-third of the world’s seaborne oil.
Over the year, the price of Brent North Sea crude jumped by almost one-quarter and the New York benchmark contract West Texas Intermediate soared more than one-third in value, helped by tighter supply.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS