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Dec 26, 2018

Asia, Europe & US Markets at Close Report.


Japanese stocks partially rebound from Christmas Day rout

Eustance Huang

Japanese stocks saw gains on Wednesday following a Christmas Day plunge of both the Nikkei 225 and Topix.
The Nikkei 225 gained 0.89 percent to close higher at 19,327.06, while the Topix index saw gains of 1.12 percent to finish its trading day at 1,431.47. Shares of index heavyweight Fast Retailing, the company behind the Uniqlo chain of apparel stores, bucked the overall positive trend in Japan as they slipped 0.92 percent on the day.
The moves came after the share average plummeted around 5 percent on Tuesday, putting the index well into bear market territory as it was more than 20 percent off its high in October. The broader Topix index also ended more than 4.8 percent lower.
Over in South Korea, however, the Kospi slipped 1.31 percent to close at 2,028.01 as shares of industry heavyweight Samsung Electronics shed 1.16 percent.
The mainland Chinese markets, watched in relation to the trade spat between Beijing and Washington, slipped on the day. The Shanghai composite fell around 0.26 percent to close at about 2,498.29. The Shenzhen composite also slipped 0.42 percent to close at about 1,279.79, and the Shenzhen component slipped 0.584 percent to finish its trading day at around 7,289.55.
The Australian and Hong Kong stock markets were closed for a public holiday.

Asia-Pacific Market Indexes Chart

NIKKEINikkei 225 IndexNIKKEI19327.06171.320.89
HSIHang Seng IndexHSI25651.38-102.04-0.40
ASX 200S&P/ASX 200ASX 2005493.8026.200.48
KOSPIKOSPI IndexKOSPI2028.01-27.00-1.31
CNBC 100CNBC 100 ASIA IDXCNBC 1007086.4412.010.17
Trump again takes aim at the Fed
U.S. President Donald Trump on Tuesday continued his spate of open criticism of the Federal Reserve, saying the central bank was hiking interest rates too quickly.
“They’re raising interest rates too fast because they think the economy is so good. But I think that they will get it pretty soon,” Trump told reporters in the Oval Office, referring to the Fed.
Still, the U.S. president suggested that investors should now be buying into the ongoing sell-off.
“I have great confidence in our companies. We have companies, the greatest in the world, and they’re doing really well. They have record kinds of numbers. So I think it’s a tremendous opportunity to buy,” Trump said after speaking with U.S. troops deployed abroad via video conference.
Trump’s comments came on the back of a recent steep decline in the U.S. stock markets amid concerns over weaker economic growth. The president himself has often attributed the fall to the Fed, tweeting on Monday that the central bank is “the only problem” with the U.S. economy.
The Dow Jones Industrial Average and S&P 500 saw their worst Christmas Eve performance in history on Monday. The Dow plunged more than 650 points to fall below 22,000 while the S&P 500 dropped 2.7 percent and slipped into bear market territory. The Nasdaq Composite also fell 2.2 percent.
Futures on Wednesday afternoon pointed to a continued tumble for the three major indexes stateside.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.580 after seeing a high of 96.66 earlier.
The Japanese yen, widely viewed as a safe-haven currency, traded at 110.46 after touching an earlier high of 110.12.The Australian dollar was at $0.7050 after touching an earlier low of $0.7030.
— Reuters contributed to this report.


European stocks close lower in shortened session; French CAC drops 1.5%

Ryan Browne

European shares closed lower Monday following a session of heavy selling stateside last week.
The FTSE 100 closed down 0.6 percent during a shortened session before the Christmas holidays, while the French CAC 40 slipped 1.5 percent. Germany’s DAX and the Italian FTSE MIB were not open on Monday.
In corporate news, BMW was hit by the South Korean government with a 11.2 billion won ($9.96 million) fine on Monday, and faces a complaint over allegedly delaying recalls and concealing defects that resulted in engine fires in the country.
On Friday, stocks stateside plunged, with the Dow Jones Industrial Average suffering its worst week since the 2008 crisis, the Nasdaq Composite slipped into a bear market and the S&P on the verge of one itself.
Slowdown fears weigh
Market players are mostly focused on lingering fears of a slowdown in global economic growth. The Federal Reserve last week raised interest rates for a fourth time this year at its latest monetary policy meeting, as was expected, but the U.S. central bank was less dovish than many traders had anticipated. Some are worried it may be tightening policy too fast.
Meanwhile, political drama stateside will be another area of focus for traders, with the government facing a partial shutdown that is likely to last until at least Dec. 27, according to Senate Majority Leader Mitch McConnell.
Treasury Secretary Steven Mnuchin held calls with top U.S. bankers over the weekend following the recent slide in equities, and made plans to convene a group of officials sometimes referred to as the “Plunge Protection Team.”
Clarification: Germany’s DAX index and the Italian FTSE MIB were not open on Monday.



Fred Imbert,Eustance Huang

Stocks rose sharply in volatile trading on Wednesday as surges in retail and energy shares helped Wall Street regain the steep losses suffered in the previous session.
The Dow Jones Industrial Average traded 950 points higher as of 3:45 p.m. ET, while the S&P 500 gained 4.2 percent. The Nasdaq Composite outperformed, rising 5 percent.The Dow and S&P 500 traded lower earlier in the day.
Retailers were among the best performers on Wednesday, with the SPDR S&P Retail ETF (XRT) jumping 4.4 percent. Shares of Wayfair, Kohl’s and Dollar General all rose at more than 6 percent. Data released by Mastercard SpendingPulse showed retailers were having their best holiday season in six years. Amazon’s stock also jumped 7.3 percent after the company said it sold a record number of items this holiday season.
WATCH: Amazon’s stock once tanked 90%? Long-term investors still got rich

Energy stocks also jumped as U.S. crude oil prices catapulted more than 8 percent. Shares of Marathon Oil and Hess were the best performers within the energy sector, jumping 7.6 percent and 6.9 percent, respectively.
John Augustine, chief investment officer at Huntington Private Bank, said he welcomed Wednesday’s rally but added: “We still have a ways to go. We need to have three days of moving higher into the close to stem this wave of selling.”
A strong sell-off on Monday sent the major indexes down more than 2 percent and ended with the S&P 500 falling into a bear market. The S&P 500 was down 20.06 percent from an intraday record high set on Sept. 21 before Wednesday’s sharp rebound. U.S. exchanges were closed Tuesday for the Christmas holiday.
The recent decline in stocks “is a buyer’s strike due to lack of confidence in policymakers around the world,” said Augustine. “It’s going to take a long time to recover that confidence.”
The plunge in stocks on Monday came after Treasury Secretary Steven Mnuchin held calls with CEOs of major U.S. banks last weekend and issued a statement saying, “The banks all confirmed ample liquidity is available for lending to consumer and business markets.”
Monday’s move lower also came after President Donald Trump commented on the Federal Reserve once more, calling it “the only problem our economy has” in a tweet. Trump also said Tuesday the Fed was “raising interest rates too fast because they think the economy is so good. ” Trump has been critical of the Fed’s decisions regarding monetary policy this year. The central bank has hiked overnight rates four times this year.
“With the end of the quarter, we could get a bounce in the next few days,” said Peter Cardillo, chief market economist at Spartan Capital Securities. But “the problem is [President Donald] Trump continues to create a lot of uncertainty. We can’t focus on the fact there are a lot of good bargains out there.”
This is all taking place amid an ongoing government shutdown that started last week. The Trump administration and congressional leaders are at a stalemate over funding for a wall along the U.S.-Mexico border. The administration says the wall is important for national security while opponents of the barrier note it will not solve the U.S.′ immigration issues.
“Government shutdown starts with no end game strategy by either side,” L. Thomas Block, Washington policy strategist at Fundstrat Global Advisors, said in a note to clients. “The President ... remains convinced that fighting for HIS wall is worth a government shutdown and his base loves the confrontation.”
—CNBC’s John Melloy and Michael Sheetz contributed to this report.

Source: CNBC

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