Market Commentary – December 8, 2021

Kevin Jock

8th December 2021

Global shares rallied massively on Tuesday, as investors are encouraged by signs that the virus variant may prove less serious than expected. The S&P 500 closed 2.07% higher, while the Nasdaq climbed 3% with both indices enjoyed their biggest one-day gains since March.

European equities jumped on Tuesday as well, boosted by a strong rebound in technology shares with the Euro STOXX 50 rose significantly by 3.36% to 4,276.20 points. Germany’s DAX surged close to 3% as well, led by automakers. Technology stocks surged 5.6% after hitting seven-week lows on Monday.

In Asia, Japan’s Nikkei 225 index bounced 1.12% at the mid-day close. HK’s Hang Seng index hovered around the flatline towards mid-day trading session. On the other hand, some of the offshore bondholders of Evergrande Group didn’t receive coupon payments by the end the grace period, which has pushed the property developer closer to a formal default.

Brent crude, the global oil benchmark, settled 3.2% higher at $75.44 a barrel. Bitcoin is continuing its comeback from the weekend selloff, with the price gaining another 4%. Other major cryptocurrencies are higher as well. Meanwhile, the Chinese Yuan edged lower against the dollar after China’s central bank loosened monetary policy but is still trading close to a three-year high at around 6.36.

image_2021_12_08T06_21_45_393Z

Figure 1 (Source: IS Prime) IDX.US.100 Daily : Nasdaq enjoyed an exceptional performance on Tuesday as it ascended by over 3%.

Headliner to Review

  • The ZEW Indicator of Economic Sentiment for Germany decreased in the current December 2021 survey, falling 1.8 points to a new reading of 29.9 points. It is an indication that the German economy is suffering noticeably from the latest developments in the COVID-19 pandemic, with persisting supply bottlenecks weighing on production and retail trade.

Headliner to Watch

  • Chinese CPI data is forecasted to increase by 2.5%, which is set to show a light moderation in factory prices from October’s highs and a pickup in consumer costs.
  • US weekly unemployment claim figure is due to release on Thursday, expected to be 218K.

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Authors:
Antony Tan
Kerry Man