Market Commentary-January 18

American markets were marginally up for both the broader S&P500 and Nasdaq while the DJI just drifted back and forth. But, then rumors of a possible breakthrough as America considering easing trade tariffs on China had a dominant bullish mode. 

The DJI immediately rallied 250 points, along with other indices by adding 1%. These rumors were soon denied, however, stocks assets held on to much of these advancements. The Russell 2000 index managed to recover and produce new highs as we rolled into the close. 

Economic climate numbers released yesterday led to much better growth as Factory Orders rebounded and Initial Job Claims fell. U.S. government shutdown has now been going on since December 22nd, 2018, therefore, there is growing anxiety this might hit the January's jobs data in February report. All indices finished around plus 0.75% on the trading day session.

Foremost talking topic in Asia-Pacific region yesterday was in the Chinese stock market after Premier Keqiang’s cautioning of a problematic 2019 ahead. Offering pledges of added public infrastructure and services, along with several public spending assistance - the market at the beginning responded very favorably. 

On open trading came from negative territory, both the H.K. Hang Seng and core Shanghai indices scaled back to trade about plus 0.7% higher on the session. Though, this wasn't to last and in the final trading hour market fell back into the negative area and finished off minus 0.5% and the day's lows.

Eurozone stock markets are finding it more challenging to pick what they should be doing, but, with Brexit being anyone’s storyline – that is not surprising. The vital feature in yesterday trading session was the plus 0.75% rally seen in Sterling (See below chart). 

Eurozone bank sector was lower early in the morning trading following news reports of America's acts against Huawei, citing them of IP piracy and the potential disruption of trade negotiations. This followed by weak earnings announcement from Society Generale whose stock shares fell over 5%. 

Italian banks were lower too; however, talk of possible mergers and acquisitions developed to curb these losses. Most major indices were off nearby minus 0.4% while the FTSE MIB index ended virtually unchanged.