Weekly round up
UK markets were negative this week with the FTSE 100 Index falling 1.37% to trade at 7,233 points at the time of writing.
This was despite the release of better than expected economic data, with retail sales rising 0.8% in October, the first gain in six months and above forecasts of 0.5% amid early Christmas shopping.
The main contribution came from sales at non-food stores, up 4.2%, namely second-hand, toys, sports equipment and clothing stores.
In contrast, sales of fuel declined 6.4% as consumption normalised, following strong growth in September, and sales of food edged down 0.3%. The proportion of retail sales online fell to 27.3% in October 2021, the lowest proportion since March 2020 at 22.5%, but substantially higher than the 19.7% in February 2020 before the coronavirus pandemic. The annual inflation rate was the highest level in 10 years, the labour market remains robust even after the end of the furlough scheme.
In China, the Shanghai Composite Index rallied 1.13% to close at 3,560 while the Shenzhen Component Index advanced 1.19% to 14,752 on Friday, as Chinese mainland stocks outperformed in Asian Markets.
New energy firms led the market higher, with significant gains also coming from the logistics, property and consumer related sectors. Chinese authorities said on Thursday that the country will guide lithium battery makers to enhance technological innovation. Meanwhile, the logistics sector was lifted by robust earnings while property firms gained on hopes of regulatory easing.
The Yuan stabilised around 6.38 per US dollar on Friday, holding its ground against a rallying US dollar, supported by strong corporate demand from Chinese firms and optimism regarding Sino-American relations.
US stock futures traded higher on Friday, after the technology sector lifted the S&P 500 and Nasdaq Composite indices to fresh record closes as strong earnings outweighed inflation concerns.
Nvidia led the gains in the technology sector, surging 8.25% on robust third quarter results, followed by strong returns from Apple (2.85%), and Advanced Micro Devices (2.43%) among others.
Big name retailers Macy’s and Kohl’s jumped 21.17% and 10.62% respectively on impressive earnings and upgraded forecasts. Meanwhile, the Dow Jones Index underperformed dragged down by a 5.5% decline in Cisco after the company reported lower than expected revenues and weaker guidance.
The US dollar is set to finish up for a fourth consecutive week, owing to market expectations that the Federal Reserve will raise interest rates earlier than indicated amid persistent inflationary pressures and strong economic data.
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