Market Commentary – November 15, 2021

Kevin Jock

16th November 2021

Wall Street stocks closed higher on Friday, with market-leading growth shares kick-starting indices’ climb. Despite their advance, all three major US indices ended the session below the close on 5th November, ending a five-week streak of weekly advances. Share price of Tesla dropped further after Elon Musk sold an additional $700 million worth of stock, due to his infamous Twitter poll on whether he should offload shares in the company he founded.

On the other hand, European shares closed their sixth straight week of gains at a new high on Friday, as strong results from Cartier owner Richemont rounded off a robust earnings season. The Euro STOXX 50 index rose 0.28% to 4,370.33 points, a new high since 2007. While the French CAC 40 ascended by 0.45%, keep making all-time highs. Richemont surged 10.9% and was the best-performing European stock for the day.

In Asia, Japanese shares rose on Monday as chip-making equipment supplier Tokyo Electron leading gains, with the Nikkei 225 index gained 0.49% before mid-day close. Meanwhile, China stocks fell on Monday after data showed property investment and sales growth continued to slow, with CSI300 index fell 0.4% at the end of the morning session. Trading on the Beijing Stock Exchange kicked off on Monday as well, with shares of the 10 companies that recently conducted IPO on the new Chinese bourse surging as much as six-fold and triggering circuit breakers.

Price of gold continue to trend higher on last Friday as gold is still the go to asset to combat inflation, reaching $1868.64 per ounce. Crude oil prices skidded on Monday, under pressure from expectations of higher supplies and weakening demand, fell to nearly $82 a barrel. While USDTRY has broken through the psychological 10 mark on Friday.

image_2021_11_15T06_40_17_833Z

Figure 1 (Source: IS Prime) IDX.EU.50 Daily : Reinforcing Europe’s economic prosperity beyond the pandemic, the STOXX 50 breaks record highs again.

Headliner to Review

  • Consumer confidence in the US deteriorated in early November with the University of Michigan’s Consumer Sentiment Index declining to 66.8 from 71.7 in October. This marked the lowest reading since November 2011. Such decline is due to an escalating inflation rate and the growing belief among consumers that no effective policies have yet been developed to reduce the damage from surging inflation.
  • The Chinese monthly retail sales figure released in this morning, came out to be an increase of 4.9%, much higher than the forecasted figure of 3.8%.

Headliner to Watch

  • US Retail Sales are projected to rise 1.2% in October after climbing 0.7% the month prior. While its Industrial Production release is expected to climb by 0.9%, compared to a contraction of 1.3% in the previous month.

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Authors:
Antony Tan
Kerry Man