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May 12, 2018

Asia, Europe and U.S. Stock Markets Report on May 11, 2018 | CNBC


Stocks, currencies, oil and earnings in focus

Cheang Ming

Most Asian stocks closed higher on Friday, with positive sentiment partially driven by gains seen on Wall Street following softer-than-expected U.S. inflation data. Meanwhile, oil prices were slightly lower after reaching recent multi-year highs on geopolitical concerns.
The Nikkei 225 closed up 1.16 percent, or 261.30 points, at 22,758.48 in Tokyo and the broader Topix gained 0.98 percent. Gains were broad based as investors focused on robust earnings releases in Japan, with the technology and financial sectors advancing, although the Topix mining subindex was down 3.81 percent.
In Seoul, the Kospi climbed 0.55 percent to 2,477.71, aided by the move higher in tech and auto sector stocks, although Samsung Electronics shed 0.58 percent.


261.30 1.16%
HSI HSI 31122.06
312.84 1.02%
ASX 200 S&P/ASX 200 6116.20
-2.50 -0.04%
SHANGHAI Shanghai 3162.85
-11.56 -0.36% 
KOSPI KOSPI Index 2477.71
13.55 0.55%
CNBC 100 CNBC 100 ASIA IDX 8752.07
87.80 1.01%
Over in Sydney, the S&P/ASX 200 gave up early gains to close off by 0.04 percent at 6,116.20 as the financials and energy subindexes weighed. Major miners, however, ended the day higher.
The Hang Seng Index rallied 1.01 percent by 3:06 p.m. HK/SIN, with the index on track for its fifth straight day of gains. All sectors on the index traded higher, with gains led by financials and conglomerates. CK Hutchison Holdings stock was up 1.15 percent a day after billionaire Li Ka-shing handed down the chairman position to his son Victor Li.
Mainland markets, meanwhile, finished the day lower, with the Shanghai composite off by 0.36 percent at 3,162.85. The Shenzhen composite fell 1.03 percent to 1,825.14.
Markets in Malaysia remained closed on Friday for a special holiday following the landmark general election win by Mahathir Mohamad's opposition alliance.
The iShares MSCI Malaysia ETF, which had initially dropped more than 6 percent in reaction to the surprise election outcome, regained 1.76 percent on Thursday. A knee-jerk reaction that will likely be "more negative than positive" is expected when markets reopen next week "as investors had been pricing in continuity of previous government policy," Prakash Sakpal, Asia economist at ING, said in a note.
MSCI's broad index of shares in Asia Pacific, excluding Japan, was up 0.76 percent.
Overall gains in the region came on the back of Wall Street's sharp gains in the last session, which also saw the Dow close positive for 2018. The overnight advance stateside followed the release of weaker-than-expected U.S. inflation data in the last session.
The lighter-than-forecast number eased concerns about the Federal Reserve tightening monetary policy at a faster rate than the market is expecting.
Geopolitics remained a focus in commodities markets, with oil prices trading slightly lower. On Thursday, U.S. West Texas Intermediate futures were off by 0.14 percent at $71.26 per barrel and Brent crude futures edged down by 0.22 percent to trade at $77.30.
Oil had settled slightly higher in the last session amid investor concerns over the impact of renewed U.S. sanctions on Iran oil exports. President Donald Trump had announced the U.S. would withdraw from the Iran nuclear deal earlier this week.
Bank of America Merrill Lynch analysts said Brent crude prices could rise as high as $100 per barrel on the back of factors including geopolitics.
Also of note, Trump on Thursday said his meeting with North Korean leader Kim Jong Un is set to take place in Singapore on June 12. The meeting comes on the back of easing tensions on the Korean Peninsula, with Kim having met South Korean leader Moon Jae-in in April.
The dollar index, which tracks the greenback against a basket of currencies, was softer following the release of U.S. inflation data on Thursday. The index firmed slightly to trade at 92.802 at 2:54 p.m. HK/SIN after touching as high as 93.42 earlier this week. Against the yen, the dollar traded at 109.31.
In corporate news, Australia's AMP fell 5.81 percent, underperforming other Australian bank shares. Its stock was downgraded to neutral from outperform by Macquarie Equities, Reuters said.
Suzuki Motor popped 8.96 percent after the automaker announced expectation-topping full-year operating profit on Thursday. Suzuki forecasts full-year operating income in the year ending March 2019 to come in at 340 billion yen ($3.11 billion).
— CNBC's Fred Imbert contributed to this report.


Europe shares record the longest winning streak in 3 years

Alexandra Gibbs, Justina Crabtree, Silvia Amaro, David Reid

European markets finished the week higher on average to secure the longest weekly winning streak in three years.


FTSE FTSE 7724.55
23.58 0.31% 754560968
DAX DAX 13001.24
-21.63 -0.17% 86261661
CAC CAC 5541.94
-4.01 -0.07% 63184350
IBEX 35 --- --- --- --- --- ---
The pan-European Stoxx 600 ended Friday 0.38 percent higher with the different sectors moving in opposite directions.
Basic resources led the gains, up by 1.7 percent, on earnings. The world's largest steelmaker ArcelorMittal jumped 2.3 percent after beating first-quarter expectations.
Looking at individual stocks, Sika shares finished up by 8.33 percent, putting among the top-performing companies across Europe. This was after news that the autos parts company struck an agreement with Saint-Gobain to end a legal dispute.
Shares of Daily Mail General Group have traded higher Friday, closing up by 1.34 percent. Its shares jumped following news that property portal Zoopla had agreed to be bought by Silver Lake. The Daily Mail has a large stake in the U.K. property firm. The deal has also driven higher the shares of other U.K. property firms, including Rightmove, which jumped 3.8 percent.
Meanwhile, oil prices have come off slightly after consecutive increases. By evening trade in Europe, Brent hovered at around $77.25 per barrel, while U.S. crude sat around the $71.01 mark.
European Central Bank President Mario Draghi addressed an audience in Florence, Italy, in the early afternoon. Markets remained unmoved by his call to increase fiscal powers for the euro zone.
Mario Draghi, President of the European Central Bank (ECB) addresses a press conference following the meeting of the ECB's Governing Council in Frankfurt am Main, western Germany, on January 25, 2018. Daniel Roland | AFP | Getty Images
Mario Draghi, President of the European Central Bank (ECB) addresses a press conference following the meeting of the ECB's Governing Council in Frankfurt am Main, western Germany, on January 25, 2018.
In the United States, equities rose slightly Friday, as Wall Street looked to book a week of solid gains led by energy stocks.


Dow posts 7-day winning streak and biggest weekly gain since March

Fred Imbert, Alexandra Gibbs

The Dow Jones industrial average rose on Friday as Wall Street booked a week of solid gains following a strong rally in energy stocks. The Dow also posted a seven-day winning streak.
The 30-stock index closed 91.64 points higher at 24,831.17 with Verizon and Merck as the best-performing stocks. Meanwhile, the S&P 500 gained 0.2 percent to close at 2,727.72 as telecommunications and health care outperforming. The Nasdaq composite closed just below breakeven at 7,402.88.
For the week, the the Dow rose 2.3 percent — its biggest weekly gain since March — while the S&P 500 and Nasdaq climbed 2.4 percent and 2.7 percent.

Energy stocks led the way for the major indexes this week, climbing 3.8 percent. The sector received a boost from surging oil prices, which jumped after President Donald Trump pulled the United States out of the Iran nuclear deal.
"Energy is going to lead the market," said Marc Chaikin, CEO of Chaikin Analytics. "I don't think the current price of oil is pricing in the full ramifications of the Iran deal."
Back in 2015, the Obama administration and Iran signed a deal to defer sanctions on Iranian oil exports, while Iran curbed its nuclear program. On Tuesday, Trump said the U.S. was pulling out of that deal and restoring sanctions.
Technology shares also contributed to the index's weekly gains, rising 3.5 percent. Leading the S&P 500's biggest sector by market cap were Facebook and Google-parent Alphabet, which climbed more than 5 percent. Apple — the biggest U.S. publicly traded company — reached an all-time high this week.
Equities broke out of a tight trading range this week. The S&P 500 and Dow closed above their 50-day moving averages this week. The 50-day moving average is a key technical level watched by technical analysts and strategists.
"Tough just yet to think the market is completely out of the woods, but it's been right to be bullish and until trends reverse …, this will still be the case," said Mark Newton, managing member at Newton Advisors. "We've seen constructive trend breakouts in the SPX and in [Dow] yesterday, while Nasdaq got over April highs and seems to have a bit more to go higher."
In corporate news, chipmaker Nvidia reported better-than-expected earnings and revenue, while giving upbeat guidance. The stock fell 2.2 percent, however.
Verizon shares jumped more than 3 percent after analysts at J.P. Morgan upgraded the telecom giant, noting that its heft dividend and 5G network plans will be a boost.

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