Global

Fewer job openings and concerns of an economic slowdown battered the US stock market last week, resulting in the S&P 500’s worst weekly drop in 18 months. The Fed’s lack of clear timelines regarding rate cuts also affected investors’ sentiment. 

The oil market is currently experiencing a strong sell-off. Brent Crude is trading below $70, nearing a three-year low due to weak oil demand. However, there were a few gainers and losers in the market.

Top Gainers and Losers in the US Stock Market

Top Gainers

The following are the top gainers in the last one week. 

Stocks	Last 7 Days Gains (in %)
Oracle	10.99
American Tower Corporation	8.97
Tesla	5.07
Verizon Corporation	4.03
Mondelez International	4.44

Top Losers

The following are the top losers in the last one week across various sectors

Stocks	Last 7 Days Loss (in %)
ASML	15.82
KLA Corporation	11.44
Google	8.08
Conocophillips	7.06
Nvidia	6.06

In the last week, weakness in the market was led by Electronic Technology, Technology Services, Producer Manufacturing, Energy Minerals, and Consumer Services. While Retail Trade, Consumer non-durables, Commercial Services, Utilities, and Health Technology. 

Due to falling crude oil prices, the S & P 500 Energy Index has dropped 4.57% in the last five trading sessions. 

Let’s check out how the major US stock market indexes stand out during the week. 

Nasdaq 100

After last week’s sell-off, Nasdaq gained ground as the rebound continued. Broadcom, the key hardware supplier for iPhone 16, has gained upside momentum and is up by more than 5% in the last 24 hours. 

Nvidia, a semiconductor chip manufacturer, is trading with a positive bias this week after falling nearly 14% the previous week. 

On Tuesday (September 10, 2024), the Nasdaq 100 continued to trade with a positive bias and slowly gained momentum. At the end of the day, it gained nearly 1%. 

S&P 500

S&P 500 stocks gained ground as traders and investors reacted to a strong sell-off in the oil markets. Lower energy prices may provide additional support to many struggling industries and boost the labor market. 

On Tuesday (September 10, 2024), the S&P 500 gained 0.45%, trying to go past the psychologically important 5,500 level. If the index manages to break above the 20 EMA slope, we may see additional buying in the market, which can propel the index toward its all-time high.

Conclusion

In the short term, markets will likely remain volatile, and future directions will depend on the Consumer Price Index and Producer Price Index reports. A lower-than-expected inflation number can boost growth sectors like technology and consumer discretionary, as lower inflation reinforces expectations of more than one Fed rate cut. However, if inflation exceeds expectations, the market may fall as chances of rate cuts diminish, and more aggressive monetary tightening may resurface.

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

The global market experienced a significant sell-off this week due to slowdown concerns and a bearish short-term outlook, which influenced investor sentiment. The US market fell the most in one week in 18 months. Meanwhile, the European market responded to the deteriorating global economic growth outlook. Furthermore, the weak corporate earnings reports and economic data from the world’s second largest economy are dragging down the global market.

Brent Crude has fallen to its lowest level in 14 months due to concerns about demand in the United States and China. It is currently trading near $70 and has dropped by nearly 7% in the past week. Gold continues to trade with a sideways bias.

Let’s take a look at how the major stock market indices did this week.

Index	Previous Day Change (%)	WoW Change (%)
US Markets
Dow Jones	-1.01	-2.93
S&P 500	-1.73	-4.25
Nasdaq	-2.55	-5.77
European Markets
FTSE 100	-0.74	-2.33
CAC 40	-1.08	-3.65
DAX	-1.50	-3.20
Asian Markets
Nifty 50	-1.17	-1.79
Nikkei 225	-0.73	-5.84
Straits Times	-0.12	0.34
Hang Seng	-0.07	-.2.34
Taiwan Weighted	1.15	-3.74
KOSPI	-1.23	-4.86
SET Composite	1.64	5.05
Jakarta Composite	0.53	0.67
Shanghai Composite	-0.81	-2.69

US Markets

Negative events in the economy resulted in the US stock market entering a bearish state. Weak labor market, rout in tech stocks, and job cuts all affected the market. 

The country added 142,000 jobs in August, against expectations of 160,000 jobs. Also, July’s gain was revised down, which further complicated the economic growth revival picture. 

Let’s check how the top US indices performed during the week. 

Dow Jones

Amidst the broader pullback in the market, Dow Jones dropped by 1.01% on Friday, and for the entire week, the index reported a cumulative loss of 2.93%. 

S&P 500

S&P 500 retracted the most on the weekly basis in 18 months as fears of recession rising among investors. The index dropped by 1.73% on Friday, taking the weekly loss to 4.25%. 

Nasdaq

Sell of tech stocks and growth worries made the situation worse for Nasdaq. Nvidia, one of the most valuable tech companies in the world, has dropped by close to 14% in the last five trading sessions. On Friday, the index closed 2.55% lower and on a week-on-week basis, it dropped by 5.77%. 

European Markets

Echoing the US market sentiments, European markets also traded with a bearish note during the week. Concerns of disinflation and structurally sluggish economic growth also give investors some worries.

Now, let’s look at how the top three European indexes performed during the week.

FTSE 100

Compared to European peers, and the US market, the UK stock market index, FTSE 100, fell significantly lower. On Friday, the index was down by 0.74% and on a week-on-week basis, it was down by 2.33%. 

CAC 40

Mixed economic data, and fears of slowdown in US economic growth soured investor sentiment. Paris bourse CAC 40 was down by 1.08% on Friday, taking the weekly cumulative loss to 3.65%. 

DAX

In July, German manufacturing orders increased by an unexpected 2.9%. However, industrial production in Germany fell much more than expected, by 2.4% sequentially, after rising 1.7% the previous month.

During the week, Germany’s primary stock market index, DAX, registered a total loss of 3.2%. In Friday’s session, it was down by 1.50%. 

Asian Markets

Global factors combined with back to back weak economic indicators from world’s second largest economy resulted in the market to trade with a negative bias, with few exceptions around. 

Let’s now have a look, how the major stock market index performed during the week. 

Nifty 50

Historically, a weak month, the Indian market continued to be under corrective pressure. During the week, Nifty 50 went past 25,000 level, hitting a new all time high level. But, failed to maintain the positive momentum. On Friday, Nifty 50 was down by 1.17%, and on a week-on-week basis, it was down by nearly 1.8%. 

Nikkei 225

Weakness in semiconducor stocks and yen strength posing a challenge for Japan’s export-oriented companies kept the market under pressure. On Friday, Nikkei 225 was down by 0.73% and on a weekly basis, the total losses for the index was nearly 6%. 

Straits Times

Bucking the trend, Singapore’s equity market traded on a flat note this week. On Friday, the index was slightly down by 0.12% and on a weekly basis, it was up by 0.34%.

Hang Seng

The Hang Seng index was flat on Friday’s session and was slightly down by 0.07%. And, on a week-on-week basis, the index reported weekly cumulative loss of 2.34%. 

Taiwan Weighted

Taiwanese stocks were higher at the close of trade on Friday. Its primary stock market index, Taiwan Weighted Index, was up by 1.15% at the close on Friday, but on a week-on-week basis, it was down by 3.74%. 

KOSPI

The South Korean equity market index witnessed a second weekly loss due to the tech sell off. On Friday, the index was down by 1.23%, and for the total week, the losses increased to 4.86%. 

SET Composite

Thailand’s equity market stood out among global indices. The index rose 1.64% on Friday, bringing its total gains for the week to 5.05%. 

Jakarta Composite

Indonesian stock market index, Jakarta Composite traded mostly sideways during the week. It was up slightly by 0.53% on Friday and on a week-on-week basis, it was up by 0.67%.

Shanghai Composite

Weak housing sales data and weak corporate earnings reports, resulted in lowering buying sentiment among investors. During the week, Shanghai Composite fell by 2.69% and on Friday, it was down by 0.81%. 

Wrapping Up

In the face of a turbulent global market, the outlook remains uncertain as economic concerns weigh heavily on investor sentiment. While short-term volatility has affected major indices, long-term prospects will depend on how economies address these challenges. As we move forward, closely watching key economic data, corporate earnings, and global developments to navigate the current market landscape will be important. Staying informed and cautious could be essential as the markets adjust to these ongoing shifts.

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

Reducing recessionary fears in the United States and positive commentary from central banks worldwide are boosting global markets, including Europe. Following initial jerks in August, European markets have returned to positive territory over the last month. 

The Paris Olympics boosted Eurozone economic activity in August after stalling in July. According to S&P Global’s purchasing manager index (PMI), the services sector output rose to a four-month high of 51.2 from 50.2. Meanwhile, manufacturing production continued to contract for the 17th month because of weak foreign demand. 

Also, the probability of the ECB cutting interest rates in September has strengthened as inflation continues to decline. Germany, regarded as the engine of the EU, recorded a GDP contraction in the second quarter of 2024, shrinking by -0.1% quarter-on-quarter from +0.2% from January to March. 

Top Gainers and Losers in the European Stock Market

Top Gainers

The following are the top gainers in the last one week. 

Stocks	Last 7 Days Gains (in %)
Delivery Hero SE	11.15
BASF SE NA O.N.	4.82
Vonovia SE	4.77
Ferrari	4.41
Universal Music Group	4.32

Top Losers

The following are the top losers in the last one week across various sectors:

Stocks	Last 7 Days Loss (in %)
ASML	6.02
AEGON	5.91
Salmar ASA	5.41
Maersk	4.33
BE Semiconductor Industries	4.18

There was no clear trend in the market, which sector contributed to the market’s positive momentum. Essentially, Finance stocks led the gains in the market, followed by health technology, Consumer Durables, and Utilities. While Electronic Technology, Energy Minerals, and Technology Services stocks were mainly down.

Let’s check how the top European Indices performed. 

STOXX Europe 600

Europe’s largest stock market index, the STOXX Europe 600 index, representing almost 90% of the European market, traded positively over the week. As of 28 August, the index has traded higher by 1.26% over the last five days and is up by 1.39% over the month. 

The index reversed all the losses it recorded in the first week because of the Yen Carry Trade sell-off. STOXX Europe 600 is currently experiencing resistance at around 520, but the upside momentum continues to be strong. A break above 525 would be highly positive for the index. 

FTSE 100

UK Purchasing managers’ data for August showed that private sector output continued to grow steadily, aided by stronger new orders. The S&P Global Composite Purchasing Managers’ Index for August was 53.4, up from 52.8 in July, the highest since April.

As of 28 August 2024, the FTSE 100 is trading with a positive bias. It has been slightly down by 0.14% in the last five days. 

The index is trading range-bound and experiencing strong resistance at around 8,350. Failure to break above this level may lower the market; however, the 50-day Moving Average slope will likely provide strong support. The index must break above the 8,450 level with strong momentum to continue moving higher. 

CAC 40

The S&P Global-compiled HCOB flash purchasing managers index for France’s services sector rose to a 27-month high of 55.0 in August, up from 50.1 in July and far exceeding expectations. As of 28 August 2024, CAC 40, France’s primary stock market index, has increased by 1.05% over the last five days.

Looking at the daily chart, CAC 40 has broken above the psychologically important 50-day moving average slope, indicating bullish momentum in the short term. The 7,730 level above is the index’s next major zone. 

DAX

The contraction in the second quarter GDP number has again raised recessionary fears driven by reduced household consumption and investment. Exports of goods and services fell 0.2% from the first quarter of 2024, reflecting lower global demand and supply chain disruptions.

Following the global cues, the German index DAX has been up by 1.76% in the last five trading days. 

The market’s overall momentum is strong. It is trading close to one of its major resistance levels, 18,700. A break above would be highly positive for the market. Conversely, the index is likely to test for support before continuing to increase. 

The global stock market recovered during the week as fears of recession in the US subsided with positive news on inflation and economic growth. On the other hand, the European market found strength on the back of increasing hopes of rate cuts and improved economic sentiment. The Asian market followed the global cues, with the Nikkei 225 index leading the charge of top gainers. 

Gold climbed 4.68% during the week, reaching a new high level, while crude oil continued to trade weak. 

How the major stock market indices did this week

Index	Previous Day Change (%)	WoW Change (%)
US Markets
Dow Jones	0.24	2.94
S&P 500	0.20	3.93
Nasdaq	0.21	5.29
European Markets
FTSE 100	-0.43	1.75
CAC 40	0.35	2.48
DAX	0.76	3.38
Asian Markets
Nifty 50	1.65	0.62
Nikkei 225	3.51	8.67
Straits Times	1.11	3.63
Hang Seng	1.84	1.99
Taiwan Weighted	2.03	4.10
KOSPI	1.95	4.20
SET Composite	1.01	0.46
Jakarta Composite	0.30	2.41
Shanghai Composite	0.07	0.60

World Stock Market Index: US Markets

US stock market indices rebounded sharply during the week, marking the best week since November 2023. Positive commentary from the Fed on rate hikes and an uptick in retail sales in July helped the market reverse the August 5th sell-off loss. 

Let’s see how the world’s most tracked indexes performed.

Dow Jones

The 30-component index closed the week positively, supported by gains from industrial giants like Boeing, Cisco, and others. On Friday, Dow Jones gained 0.24%, and on a weekly basis, the index was up by 2.94%. 

S&P 500

Improved consumer sentiment in July helped the S&P 500 index gain higher during the week. The market ignored the weak housing sector report, which indicated new housing activity has retreated to early pandemic levels.  On Friday, the S&P 500 index was marginally higher by 0.20%, but it posted strong gains of 3.93% on a week-on-week. 

Nasdaq

The rally in tech stocks led to solid gains in Nasdaq, with Nvidia leading the charge. On Friday, Nvidia posted the best weekly gains of 18%, after posting four consecutive weeks of less. Year-to-date, the stock has gained 149%.  On Friday, the Nasdaq traded flatly, recording a slight gain of 0.21%. On a week-on-week basis, the index gained 5.29%. 

World Stock Market Index: European Markets

Improved sentiment in the US market, dovish central bank commentary, and improving economic indicators helped the European market to trade positively during the week. 

Let’s look at how the top three European indexes performed during the week. 

FTSE 100

In July, headline inflation in the UK rose to 2.2% from 2.0% in June. However, growth in service prices slowed more than expected, which increased hopes for a higher likelihood of interest rate cuts later this year. 

On the other hand, GDP expanded 0.6% sequentially during the April to June quarter, putting the economy on a strong footing. 

On Friday, the FTSE 100 was slightly down by 0.43%. On a weekly basis, the index concluded the week with gains of 1.75%. 

CAC 40

France grew at 0.3% this quarter, the same rate as the previous quarter. Although the country may see an economic boost from the Olympics in the third quarter of this year. On Friday, the country’s primary stock market index, CAC 40, gained 0.35%, taking the total weekly gain to 2.48%. 

DAX

Germany, the eurozone’s largest economy, experienced a surprise contraction of 0.1% in the second quarter of 2024, against the expected 0.5% increase. This compares to a 0.2% increase in the previous first.

However, the market shrugged off the weak GDP growth data, and DAX rose by 0.76% on Friday. On a weekly note, the index gained 3.38%. 

World Stock Market Index: Asian Markets

Reversing the trend, Japan led the gains in the Asian market. Better-than-expected economic data from the United States boosted sentiment, easing fears of a recession in the world’s biggest economy.

Let’s look at how the primary stock market index performed during the week. 

Nifty 50

It was a volatile week for the Indian market as major indices sought triggers. On Friday, the Nifty 50 traded on a positive note and gained 1.65%, helping it to wipe the weekly loss and gain 0.62% at the close of the week. 

Nikkei 225

Japan’s second-quarter GDP growth beat expectations by expanding 0.8% from the previous week, thus improving overall market sentiment. On Friday, Nikkei 225 gained 3.51%, taking the total weekly gains to 8.67%. 

Straits Times

Following global cues, Singapore’s primary stock market index traded higher. It rose 1.11% on Friday and fell 3.63% week on week.

Hang Seng

Tracking the gains of the US and European markets, the Hang Seng index gained during the week. On Friday, the index was up by 1.84%, and on a week-on-week basis, it was up by 1.99%.

Taiwan Weighted

Supported by improved sentiment in the US market and a rally in tech stocks, Taiwanese equity traded positively. On Friday, the index traded higher, going up by 2.03%, and on a week-on-week basis, it was up by 4.10%

KOSPI

The South Korean market posted its best week in seven months, as its primary stock market index, KOSPI, rose 1.95% on Friday, taking its weekly gains to 4.20%. 

SET Composite

Thailand’s equity market index, SET Composite, traded higher on Friday by 1.01%, wiping out the weekly loss and closing the week with a total gain of 0.46%.

Jakarta Composite

Jakarta Composite was up by 0.30% on Friday and 2.41% week-on-week.

Shanghai Composite

Mixed economic indicators kept the Chinese market volatile. Industrial production increased by a lower-than-expected 5.1% in July compared to a year earlier, slowing from a 5.3% increase in June, owing to lower auto sales. Retail sales increased by a better-than-expected 2.7% in July compared to a year earlier, up from 2% in June. 

Over the week, Shanghai Composite traded on a bearish note. On Friday, it was slightly up by 0.07%, but on a week-on-week basis, it was up by 0.60%. 

Wrapping Up

With economic sentiment improving across regions, the markets could continue to show resilience. However, with mixed indicators and ongoing uncertainties, investors should remain cautious and closely monitor upcoming data and central bank decisions.

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

Following last week’s chaos in the market, investor fear has subsided, and the global market is regaining its footing. Lower-than-expected producer price index data in the US has increased hopes for a rate cut by the Fed in September, leading to a surge in stock prices in the US and affecting the Asian market. 

Uneven economic recovery in China, coupled with a lack of consumer spending and lagging industrial activity, continues to be a cause of concern for global growth recovery. This led to foreign investors pulling out a record $15 billion from China in the last quarter. 

Let’s look at how the top Asian indexes performed during the week. 

Nikkie 225

Nikkie 225 recorded last week’s worst fall of the decade, erasing all the gains from this year’s rally. However, the market recovered following positive commentary from the Bank of Japan and a surge in tech and finance stocks. 

In July, Japan’s producer price index increased by 3% yearly, outpacing the 2.9% increase in June. 

The week starting 12 August 2024, Nikkei 225 traded with a positive bias, as it got support from the improving sentiment of the global market. In the last week, the index has gained nearly 4.3%. But in the previous month, it has been down by 12.4%.

Looking at the daily chart of the Nikkei 225 index, we can see that after the massive fall, the index has quickly recovered and is moving towards the next significant resistance at around 37,000. If the current momentum persists, we may see more buying in the market. Below is strong support at the 34,000 level, tested recently, and the index bounced back from there. 

Contributions from all sectors, particularly Finance, Producer Manufacturing, Technology Services, and Electronic Technology, are increasing the market.

Following are the top gainers in the last one week

Stocks	Last 7 Days Gains (in %)
Mitsubishi Heavy Industries	22.57
Recruit Holdings Co Ltd	18.38
Sumitomo Mitsui Financial Group	18.22
Softbank Group Corp	15.70
Mizuho Financial Group	14.88

Hang Seng

Last week’s China’s inflation numbers fuelled hopes for increased demand. The annual inflation rate increased from 0.2% in June to 0.5% in July. Upward trends in consumer price inflation likely indicated an increase in private consumption and economic activity.

In the last week, Hang Seng has traded with positive momentum and has gained nearly 3%. 

As reported by Bloomberg, The persistent economic slowdown in China has worried investors and increased pessimism, prompting them to withdraw their funds. Foreign investors withdrew a record $15 billion from China in the fourth quarter (April-June 2024), the highest in recent years. 

Hang Seng continues to trade on a bearish note. The daily chart shows that the index has bounced higher after testing one of its major support levels at around 16,500. We may see more buying if the index breaks above its next significant resistance at the 17,150 level. 

Finance, Energy Minerals, and Technology Services are the major contributors to this week’s index gain.

The following are the top gainers from the last week. 

Stocks	Last 7 Days Gains (in %)
Industrial & Commercial Bk Of China	7.38
Cnooc Limited	6.84
PetroChina	5.17
Tencent	4.79
China Mobile	3.68

Nifty 50

Amid high valuation concerns and volatility in the global market, the Indian stock market continues to trade on a negative. Top indices like the Nifty 50 have failed to recover the prior week’s losses. In the last five trading sessions, the Nifty 50 is slightly lower by 0.52% and is down by nearly 3.74% from its peak. 

Looking at the daily chart of Nifty 50, the index trades closely above the 50-day moving average slope, providing support. The Nifty 50 needs to cover the gap with solid momentum to move higher. If it breaks the 50 DMA slope, the market may move much lower toward its next support at the 23,660 level. 

Unlike their Asian counterparts, the Finance, Non-Energy Minerals, and Communication sectors are the index’s worst performers. IT, Energy, Consumer Durable, and Nondurable stocks all support the index. 

The following are the top gainers in the last one week. 

Stocks	Last 7 Days Gains (in %)
ONGC	6.70
JSW Steel	4.71
Cipla	4.66
Coal India	2.69
Tech Mahindra	2.59

The following are the top losers in the last one week across various sectors:

Stocks	Last 7 Days Loss (in %)
BPCL	6.22
NTPC	4.13
Grasim	4.10
HDFC Life	3.77
State Bank of India	3.05

Conclusion

As we move forward, global markets seem to stabilize after last week’s chaos and extreme volatility, driven by optimism around a potential rate cut in the US. However, uncertainties remain. Investors should stay cautious and closely monitor economic indicators and central bank actions in the coming weeks.

*Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as recommendation or investment advice by Research & Ranking. We will not be liable for any losses that may occur. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

The extended slowdown in economic activity in the US has once again fueled recessionary fears in the country. Goldman Sachs’s economist increased the likelihood of a recession next year to 25% from 15%. This spooked investors worldwide, including the European stock market. 

Also, the unwinding of the Yen Carry Trades in the global market has caused a massive sell-off. According to a news report, Yen Carry Trades in the worldwide market was reportedly around $4 trillion last week. 

However, investor sentiment remains bearish as markets cool down from increased volatility. The economic indicators in the Eurozone area are not positive either. The report showed Retail sales declined by 0.3% month-over-month in June, compared to the expectation of 0.1%. 

With so much economic uncertainty surrounding the global market, the focus has shifted toward the central bank’s actions, including whether it will pursue an early rate cut.  

Top Gainers and Losers in the European Stock Market

Top Gainers

The following are the top gainers in the last one week. 

Stocks	Last 7 Days Gains (in %)
Rolls Royce	6.24
KYGAA	6.22
Haleon PLC	5.68
Galderma Group	5.26
Rational AG	4.85

Top Losers

The following are the top losers in the last one week across various sectors:

Stocks	Last 7 Days Loss (in %)
Banco Bilbao Vizcaya Argentaria	13.93
Unicredit	13.70
STMICROELECTRONICS	13.92
PKOBP	11.49
ASM International	10.46
ABB Ltd.	9.03%

During the week, the market’s losses were not limited to one sector. The sectors with the greatest losses are financials, producer manufacturing, technology services, and consumer non-durables. Despite the losses, the Electronic Technology and Health Technology sectors are showing strength in the market.

STOXX Europe 600

The STOXX Europe 600 index is Europe’s most extensive stock index, replicating almost 90% of the European market. The overall sentiment continues to be extremely bearish. As of 7 August, the index is down by 5.02% over the last five days.

After the gap-down opening on Monday, the index trades on a bearish note. STOXX Europe 600 is now experiencing strong resistance at around 490. If the index fails to cover the gap or moves higher above the 500 level, weakness will likely persist. Below 480 is a strong support level. 

FTSE 100

Last week, the UK’s Bank of England cut the short-term borrowing rates, bringing them down from a 16-year high level to support the economy and keep the growth momentum intact.  Also, The UK’s consumer price index stayed within the central bank’s 2% target in June.

Despite the massive sell-off on Monday, the index closed above one of its key support levels at around 8,000 and is witnessing buying. The 8140 level is extremely resistive; the index might be challenging to break above it. If it breaks below the 8000 level, the next major support is around the 7700 level. 

CAC 40

The French economy is likely to have an Olympic ripple and is expected to grow by 0.3% in the third quarter, compared to the initial forecast of 0.1%. 

As of 7 August 2024, CAC 40, France’s primary stock market index, was down by 5.75% over the five days, showcasing extreme levels of volatility. Despite the cooling down, the market recovery was muted as traders avoided placing large bets, reassessed the impact of the pullback, and awaited new bullish triggers.

CAC 40 broke below one of its key support levels at around 7,300 and has formed a head-and-shoulder pattern on the daily chart, which is a bearish formation. The index is now experiencing strong support at the 7,050 level, and to reverse the bearish formation, it needs to break above the 7,320 level with solid momentum. 

DAX

German factory orders rose for the first time in a year, backed by solid demand in the auto and metal sectors. However, the DAX 30 continues to witness extreme volatility. As of 7 August 2024, the index was down by more than 6.5% over the five days. 

The European market’s overall momentum has turned negative. It is trading close to one of its major support levels, around 17,300. A break below could result in more selling. Conversely, the index needs to clear above the 17,750 level to break away from the bearish momentum. 

Conclusion 

Due to several factors, European stocks are expected to remain under pressure as we move forward. All eyes will be on central banks and their next moves, which will be crucial in determining the market’s direction. Keeping an eye on all market developments is crucial to making informed investment decisions amidst these rapidly evolving changes in the market. 

*Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as recommendation or investment advice by Research & Ranking. We will not be liable for any losses that may occur. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

It was a pretty volatile week for the global market. A massive downturn in economic activities was reported across the world’s largest economy, and second-quarter corporate earnings were weak. The impact spilled over to other parts of the world, including Europe and Asia. 

Crude oil prices continued to fall this week, with Brent Crude dropping more than 6% to settle below $80. Meanwhile, gold maintains bullish momentum due to investors’ high-risk aversion. 

Let’s look at how the major stock market indices did this week

Index	Previous Day Change (%)	WoW Change (%)
US Markets
Dow Jones	-1.51	-2.10
S&P 500	-1.84	-2.06
Nasdaq	-2.43	-3.35
European Markets
FTSE 100	-1.33	-1.34
CAC 40	-1.64	-3.54
DAX	-2.39	-4.11
Asian Markets
Nifty 50	-1.17	-0.80
Nikkei 225	-6.17	-4.67
Straits Times	-1.14	-1.31
Hang Seng	-2.12	-0.45
Taiwan Weighted	-4.64	-2.18
KOSPI	-3.79	-2.04
SET Composite	-0.74	0.45
Jakarta Composite	-0.24	0.27
Shanghai Composite	-0.93	0.50

US Markets

In the July meeting, the Federal Reserve decided to keep the interest rates on hold again on expected lines. But, the market was looking for the commentary in which Fed Chair Jerome Powell indicated strongly about the September rate cut. 

July non-farm payroll was below expectations. It rose by only 114,000, compared to the expectations of 185,000. The unemployment rate surged to 4.3%.

On the other hand, weak corporate earnings and guidance continue to hurt the world’s largest market. Amazon slipped more than 11% on Friday after revenue missed estimates and increased the capital expenditure needed to support the company’s AI program. Intel also nosedived more than 26% on Friday after the company handed out pink slips to 15,000 staff.

Let’s see how the world’s most tracked indexes performed.

Dow Jones

Amid recession fears in the economy caused by disappointing job data, companies handing out pink slips, and weak corporate earnings, the Dow Jones Industrial Average (DJIA) fell nearly 1.51% on Friday, bringing the total loss of the week to 2.10%. 

S&P 500

Disappointed economic data shocked investors and massive selling in tech stocks resulted in a pullback in the S&P 500 index. On Friday, the index was down by 1.84%, and the cumulative loss was 2.06% on a week-on-week basis. 

Nasdaq

Massive selling in tech stocks continued to hurt the tech-heavy index. On Friday, the Nasdaq fell by 2.43%, bringing its cumulative loss for the week to 3.35%. 

European Markets

Weak investor sentiment in the US also impacted the European equity market. While the Eurozone economy expanded 0.6% on a year-on-year basis in the second quarter of 2024, initial estimates show that annual inflation in the region rose to 2.6% in July compared to 2.5% in June. Also, the unemployment rate ticked up to 6.5% in June. 

Let’s look at how the top three European indexes performed during the week. 

FTSE 100

The UK stock market was steady during the week, but it fell on Friday due to weakness in the global market. The Bank of England cut its key interest rate by 0.25% to 5.00%, the first reduction since the coronavirus pandemic began in March 2020.

On Friday, FTSE 100 was down by 1.33%, taking the weekly cumulative loss to 1.34%. 

CAC 40

Amidst the Olympics euphoria in Paris, CAC 40, the primary stock market index, was down by 1.64% on Friday’s session. The index concluded the week with a loss of 3.54%. 

DAX

Recessionary fears in the US and challenging economic conditions in Germany continued to hurt the German stock market. The DAX witnessed a sharp fall during the week. On Friday, the index was down by 2.39%, concluding the week with a cumulative loss of 4.11%. 

Asian Markets

Following the global cues, the Asian market also traded weakly during the week. Domestic factors also affected the respective markets. Let’s examine how the primary stock market index performed during the week. 

Nifty 50

The Indian market had an incredibly volatile week. The market was buoyed by corporate earnings data that exceeded expectations. However, the market saw extreme volatility on Friday, with the Nifty 50 falling by 1.17%. On a weekly basis, it decreased by 0.80%. 

Nikkei 225

Disappointing macroeconomic data and the Bank of Japan’s hawkish stance on rate hikes resulted in a sharp fall in Nikkie 225. During the week, the Bank of Japan raised short-term interest rates to 0.25%.

The hike was the second time in the year. The Bank also indicated it would start tapering monthly bond purchases, moving away from the ultra-loose monetary policy. On Friday, Nikkei 225 fell sharply by 6.17%, and on a week-on-week basis, it was down by 4.67%. 

Straits Times

Following the global cues, Singapore’s primary stock market index traded on a bearish note. It was down by 1.14% on Friday and by 1.31% on a week-on-week basis.

Hang Seng

Chinese equities were mixed after disappointing manufacturing data dampened investor sentiment. On Friday, Hong Kong’s benchmark Hang Seng Index was down 2.12%, or 0.45%, from its weekly total loss.

Taiwan Weighted

The sharp decline in US tech stocks and recessionary fears due to slowing economic growth resulted in a big fall in the Taiwan Weighted Index. Taiwan is the top US trade partner and supports the global economy’s manufacturing supply chains. Any slowdown in the US and global economies will hurt the Taiwanese economy. 

On Friday, the Taiwan Weighted Index was down by 4.64%, wiping out the week’s gains. The total loss was 2.18%. 

KOSPI

South Korea’s headline inflation rose faster than expected in July, affecting investor sentiment. On Friday, the primary stock market index of South Korea, KOSPI, was down by 3.79%. On a weekly basis, the index fell 2.04%.

SET Composite

Thailand’s equity market index, SET Composite, was down by 0.74% during Friday’s session but closed the week higher by 0.45%.

Jakarta Composite

Bucking the global cues, the Indonesian stock market traded flatly during the week. On Friday, the Jakarta Composite was slightly down by 0.24%; on a week-on-week basis, it was up by 0.27%.

Shanghai Composite

China’s manufacturing Purchasing Managers’ Index (PMI) slipped to 49.4 in July from 49.5 in June, marking the third consecutive monthly contraction. 

Over the week, the Shanghai Composite traded flat. On Friday, it was down by 0.93%, but on a week-on-week basis, it was up by 0.50%. 

Wrapping Up

As we look ahead, market volatility is likely to persist as investor sentiment has turned negative. Closely watching the economic indicators, corporate earnings reports, and central bank commentary will help you gauge the future direction of the markets. As volatility persists, a cautious and well-diversified investment approach remains essential.

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