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At yesterday's stock market close, the Dow Jones Index (US30) was down by 0.22%, while the S&P 500 Index (US500) decreased by 0.06%. The Nasdaq Technology Index (US100) closed positive 0.31% on Tuesday. A decline in bond yields on Tuesday supported technology stocks and the Nasdaq 100. Bond yields fell after the October JOLTS job openings report fell more than expected to a 2-year low, a sign that the labor market is cooling and dovish for Fed policy.

Economic news from the US on Tuesday was mixed. On the bullish side, the ISM Services Business Activity Index for November rose by 0.9 to 52.7, beating expectations of 52.3. In contrast, the October JOLTS Job Openings Index fell by 617,000 to a 2-year low of 8.733 million, indicating a weaker labor market than expectations of 9.300 million.

Procter & Gamble (PG) fell more than 3% and topped the Dow Jones Industrials' list of losers after it said it expects $2.0 billion to $2.5 billion in restructuring costs for its operations in some corporate markets due to "challenging macroeconomic and financial conditions." Nvidia's (NVDA) stock price rose more than 2% and led the Nasdaq 100 higher after the company said it plans to partner with Japanese research organizations, companies, and startups to build artificial intelligence factories in Japan.

Equity markets in Europe were mostly up yesterday. Germany's DAX (DE40) rose by 0.78%, France's CAC 40 (FR40) gained 0.74% on Tuesday, Spain's IBEX 35 (ES35) jumped by 0.59%, and the UK's FTSE 100 (UK100) closed negative 0.31%. Economic news for European indices contributed to the gains. The S&P Eurozone Composite PMI for November was revised upward by 0.5 to 47.6 from the previously reported 47.1. The Eurozone Producer Price Index for October rose by 0.2% m/m to 9.4% y/y, matching expectations of 0.2% m/m and 9.5% y/y.

The ECB's monthly inflation expectations survey showed that expectations for 1-year inflation in October were unchanged from September at 4.0%, above expectations of 3.8%. 3-year inflation expectations were 2.5%, unchanged from September and in line with expectations. ECB Executive Board spokesperson Schnabel said yesterday that another ECB interest rate hike is rather unlikely.

The build-up in US crude oil exports is putting pressure on oil prices. In addition, the rise in the dollar index to a one-week high on Tuesday was a negative factor for oil. In addition, Saudi Arabia's actions to cut official oil selling prices for Asian buyers for January delivery is a negative factor for oil. Russian Deputy Prime Minister Novak said OPEC+ may take additional measures if last week's production cuts fail to balance the oil market.

Asian markets were mostly down yesterday. Japan's Nikkei 225 (JP225) decreased by 1.37%, China's FTSE China A50 (CHA50) lost 2.55% yesterday, Hong Kong's Hang Seng (HK50) fell by 1.91% on the day, and Australia's ASX 200 (AU200) was negative 0.89% on Tuesday.

China's Shanghai Composite index fell to a 5-week low as Moody's Investors Service cut its outlook on China's sovereign debt from stable to negative, weighing on global growth prospects. According to the median forecast of 28 economists surveyed, China's exports are expected to decline 1.1% in November from a year earlier, following a 6.4% drop in October and continuing a downward trend for the fourth consecutive month.

Australia's real gross domestic product (GDP) rose by 0.2% in the July-September quarter from the previous quarter, marking the eighth consecutive quarter of growth, albeit the slowest in a year. Australia's economy barely grew in the third quarter as exports contracted and households suffering from soaring mortgage payments were reluctant to spend, suggesting higher rates are curbing demand.

Ryozo Himino, deputy governor of the Bank of Japan (BoJ), said the central bank should determine the timing and appropriate structure of the exit from ultra-loose monetary policy while closely monitoring developments in wages and prices. He also noted that Japan is making progress in exiting the protracted period when wage and price growth remained stagnant.

• S&P 500 (US500) 4,567.18 −2.60 (−0.06%)
• Dow Jones (US30) 36,124.56 −79.88 (−0.22%)
• DAX (DE40)  16,533.11 +128.35 (+0.78%)
• FTSE 100 (UK100) 7,489.84 −23.12 (−0.31%)
• USD Index  103.96 +0.25 (+0.24%)
   

News feed for 2023.12.06:

• Australia GDP (q/q) at 02:30 (GMT+2);
• UK Construction PMI (m/m) at 11:30 (GMT+2);
• UK FPC Meeting Minutes at 12:30 (GMT+2);
• UK BoE Financial Stability Report at 12:30 (GMT+2);
• UK BoE Gov Bailey Speaks at 13:00 (GMT+2);
• US ADP Nonfarm Employment Change (m/m) at 15:15 (GMT+2);
• US Trade Balance (m/m) at 15:30 (GMT+2);
• Canada Trade Balance (m/m) at 15:30 (GMT+2);
• Canada BoC Interest Rate Decision at 17:00 (GMT+2);
• Canada BoC Rate Statement at 17:00 (GMT+2);
• Canada Ivey PMI (m/m) at 17:00 (GMT+2);
• US Crude Oil Reserves (w/w) at 17:30 (GMT+2).

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