Stock Markets Report 31st October

The world’s largest economy expanded more than expected in September as a report released showed that the US economy rose 3.5% in the last quarter, marking its strongest six months in a decade. A separate report released from the US Labour Department showed that fewer Americans filed applications for jobless benefits over the past month.

Meanwhile, exports in the US rose 7.8% in the last three months from 11.1% in the last quarter, while imports declined 1.7%. 

Asia Stocks

Stocks in Asia were boosted, with the Japanese benchmark Nikkei index closing at a seven-year high after the Bank of Japan increased the nation’s pension fund.

Japan’s Nikkei 225 index rose 4.83% to end the session at 16,444.39 points, the highest since 2007, while Tokyo’s Topix index edged 4.28% to close at 1,333.64 points. The Japanese yen was pushed lower against the US dollar, trading around 1.5% to 110.83 per dollar, boosting gains for exporters.

Toyota Motor advanced 3.8% to 6,498 yen, while Mitsubishi UFJ Financial Group added 4% to 632.2 yen and Sumitomo Mitsui Financial Group gained 7.2% to 4,399.5 yen.

Bank of Japan (BoJ)

The region’s shares rose after BOJ policymakers voted to expand the country’s monetary base to 80 trillion yen annually from the current 60-70 trillion. The bank also said it would triple annual purchases of exchange-traded funds and the country’s real-estate investment trusts to 3 trillion yen and 90 billion yen respectively.

“Japan’s economy has continued to recover moderately as a trend and is expected to continue growing at a pace above its potential. However, on the price front, somewhat weak developments in demand following the consumption tax hike and a substantial decline in crude oil prices have been exerting downward pressure recently,” according to the bank.

“If the current downward pressure on prices remains, there is a risk that conversion of deflationary mindset, which has so far been progressing steadily, will be delayed,” the bank added.

Meanwhile, the Nikkei newspaper reported the Japanese Government Pension Investment Fund is expected to announce a hike of its domestic shares to 25% of assets.

Hong Kong’s Hang Seng index gained 1.25% to 23,997.39 points, while the Chinese mainland Shanghai Composite added 0.97% to 2,414.75 points.

Bank of Ninbo and Bank of Nanjing each added nearly 10%, while China Railway Group declined 24%.

The South Korea’s Kospi index jumped 0.28% to 1,964.43 points, while Australia’s benchmark S&P/ASX 200 index jumped 0.5%.

Europe Stocks

Stocks in Europe traded higher on the last day of the trading week as the market focus on the preliminary inflation report for the Eurozone.

The European Euro Stoxx 50 added 1.58% to 3,083.83, while the UK’s benchmark FTSE 100 gained 1.16% to 6,538.11 and the French CAC 40 rose 1.57% to 4,206.14.

The German DAX 30 edged 1.75% to start at 9,274.72, while the German consumer prices came in at 0.8% on a yearly basis, compared to analysts’ estimates of 0.9%. Retail sales in Germany advanced 2.3% in September year-on-year from 0.1% rise seen in August and a 3.2% fall was seen on a monthly basis, the Federal Statistical Office showed.

 

 

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