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Chinese Manufacturing is Growing at the Fastest Pace in Five Years

December 4, 2009

Global markets: Weekly overview

Major stock exchanges traded sideways last week on below-average volumes. Markets headed north as soon as concern over Dubai World eased, also supported by record gold prices and strong oil. The situation changed when crude weakened in the second half of the week, pushing some markets down.

Having recouped its losses after Dubai World began talks to restructure less than half of its debt, the U.S. market drifted for the rest of the week. A steep drop in oil prices on Wednesday dragged energy producers down. Unexpected contraction in service industries put additional pressure on the market. Futures went down on Friday in expectation of jobless data publication. All in all, the U.S. market closed flat w-o-w.

Asian markets spent almost all of the week in positive territory. Speculation over the Japanese Central Bank seeking to limit the yen’s gains and consecutive weakening of the currency had a positive impact on Japanese carmakers. The MSCI Asia Pacific Index went to a six-week high on reports that Chinese manufacturing is growing at the fastest pace in five years. Asian indexes closed the week up from 5% to more than 7%.

The Russian equity market jumped the most in two weeks on Tuesday amid firm crude prices and a stronger ruble, which lifted banking stocks. A later slump in the oil price (crude spent the rest of the week at $75.5-77.0/bbl) dragged the local market down: stocks drifted for the rest of the week, posting only minor losses. As a result, local indexes managed to close the week up 2.0-2.5%.

Source: Troika Dialog


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