Global Market Report - November 6

World markets were mixed as investors braced for US midterm elections, with gains in Asia stocks balanced by weakness in Europe

James Gard 6 November, 2018 | 11:06AM

Global Market Report

Asia

Markets in Asia-Pacific managed a positive trading session, helped by gains on Wall Street overnight, but China’s Shanghai Composite Index lagged Tokyo, Hong Kong, Seoul, Sydney and Mumbai.

Japan’s Nikkei 225 was the best performer in percentage terms, and with a rise of nearly 250 points the index moved above 22,000 – despite a comeback in the Japanese yen against the US dollar. While off the highs above 24,000 points seen in January and September, the index is now at similar levels to a year ago.

Australian interest rates were left on hold at 1.5%.

Europe

Markets in Europe drifted lower on Tuesday as economic data painted a mixed picture. Italy’s services sector PMI showed a surprise contraction in October, according to the Purchasing Managers’ Index, while Germany and France service sectors continued to expand.

The FTSE 100 lost ground and moved back within reach of 7,000 points, but losses were relatively modest.

Supermarket WM Morrison (MRW) was the biggest faller after a third quarter trading update. Sainsbury’s (SBRY) reports on Thursday amid more than usual scrutiny of the UK retail sector ahead of the key festive season. Group like for like sales were up nearly 6% for the quarter to 4 November, with most of the growth driven by wholesale.

North America

Midterm elections today are overshadowing market movements. US stock markets are expected to open lower on Tuesday, tracking European weakness.

The Federal Reserve meets this week but is not expected to raise interest rates for the fourth time this year until the December meeting. A Fed meeting is usually the economic highlight of the week or month for investors, but for once monetary policy has to take a back seat to domestic politics.

Eli Lilly (LLY) and Toronto-listed media and data giant Thomson Reuters (TRI) report earnings today.

Brazil’s central bank held interest rates at 6.5%, the first monetary policy decision since the election of Jair Bolsonaro. Domestic stock markets have risen since his election on hopes of deregulation and pension reform.

 

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Eli Lilly and Co113.83 USD1.45
Morrison (Wm) Supermarkets PLC244.25 GBX0.06
Thomson Reuters Corp64.42 CAD-0.15

About Author

James Gard  is subeditor for Morningstar.co.uk