Global

It was a volatile week for the global market, with almost all major indices closing in the red. Mixed sentiment in the US market due to the significant sell-off in tech and AI stocks, lower-than-expected corporate earnings in the technology and luxury goods sectors weighing on stock market returns, and a slowdown in major Asian economies dragged the market down.

Crude oil prices continued to fall this week, with Brent Crude dropping more than 5% to settle below $81. Meanwhile, gold climbed 2.43% to a new all-time high.

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

US Markets

The US market was extremely volatile during the week as small-cap stocks outshined large-cap stocks for the second consecutive week. The $1 trillion sell-off in big tech stocks after disappointing earnings releases from Google and Tesla. Both stocks lost 7.51% and 10%, respectively, during the week. 

In June, the inflation stayed steady at an annual rate of 2.6%, not far above the 2% target for the Federal Reserve’s inflation path, which again increases the probability of a September rate cut. 

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

Dow Jones

Amidst the market volatility, the Dow Jones Industrial Average (DJIA) fell amid a surge during Friday’s session and was up by 1.64%, led by 3 M’s better-than-expected performance. Friday’s surge helped the index recover its losses during the week and close with gains of 0.75%.

S&P 500

Favorable inflation and consumer spending data helped the S&P 500 gain ground on Friday. It was up by 1.11% during the day, but it concluded the week with a cumulative loss of 0.83%. 

Nasdaq

Tesla and Google wiped $1 trillion in value of U.S. equities, indicating a broad-based correction may come. NASDAQ was up by 1.03% on Friday, but it concluded the week with a cumulative loss of 2.08%. 

European Markets

European equity markets fell midweek as earnings in the technology and luxury goods sectors weighed on returns. Further, selling in tech stocks in the US also contributed to the bearish momentum. 

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

FTSE 100

In contrast to the slowdown in major European economies, the UK economy is showing signs of good health. It continues to be one of the best-performing economies in the European region. On Friday, the index was up by 1.20%, and on a week-on-week basis, it was up by 1.59%. 

CAC 40

The country’s focus has now turned towards the Olympics, and it is expected to benefit economically from them. In Friday’s session, CAC 40 was up by 1.21%, which helped to recover some of the weekly losses. The index concluded the week with a slight loss of 0.22%. 

DAX

Germany continues to face challenging economic conditions, and the steep fall in manufacturing and services activity is leading to a slowdown similar to those in the Eurozone economy.

Following the broader cues in the European market, the DAX went higher during Friday’s session. It was up by 0.65% and 1.35% week-on-week. 

Asian Markets

The rout in US tech stocks caused most Asian indexes to trade lower this week. Furthermore, domestic factors influenced the market. Let us take a closer look at how the various Asian indices performed during the week.

Nifty 50

The Indian market experienced a particularly volatile week. On Friday, the Nifty 50 and the Sensex broke their five-day losing streak. The better-than-expected release of earnings data by IT companies contributed to the market’s positive momentum. On Friday, the Nifty 50 rose by 1.76%, up 1.50% weekly. 

Nikkei 225

Japanese technology stocks remained under pressure as shares of U.S. mega-cap technology companies experienced significant selling pressure. Japan’s stock markets witnessed sharp weekly losses, with the Nikkei 225 Index down 6.0%.

Straits Times

Bucking the market’s overall trend, Singapore’s primary stock market index was flat on Friday and down 0.12% weekly, ending the week 0.61% lower.

Hang Seng

Weaker-than-expected economic growth put Chinese stocks under pressure. In Hong Kong, the benchmark Hang Seng Index rose by 0.10% on Friday. However, every week, the index fell by 2.28%.

Taiwan Weighted

Following the cues from the global market and its Asian peers, the Taiwan Weighted index fell by 2.31% in Friday’s session. On a weekly basis, the index was down by 4.38%.

KOSPI

South Korea’s economy unexpectedly contracted in the second quarter, marking the sharpest contraction since 2022, as falling consumer spending impacted exports. GDP for April-June fell 0.2% from the previous quarter. KOSPI, South Korea’s primary stock market index, was up by 0.78% on Friday. On a weekly basis, the index fell 2.27%.

SET Composite

Thailand’s equity market index, SET Composite, was up by 1.20% during Friday’s session and down by 0.75% week-on-week.

Jakarta Composite

The Indonesian stock market failed to gain enough positive momentum during the week to close higher. On Friday, the index was up by 0.66%; on a week-on-week basis, it was slightly down by 0.09%.

Shanghai Composite

Chinese stocks fell after the central bank’s unexpected rate cuts failed to boost economic confidence. The People’s Bank of China has reduced the one-year medium-term lending facility rate to 2.3% from 2.5%. The Shanghai Composite Index fell 3.07% week on week.

Wrapping Up

As we look ahead, market sentiment remains cautious despite the sell-off of AI stocks. Closely watching the economic indicators and corporate earnings reports will help gauge the markets’ future direction. With ongoing volatility, staying informed and considering long-term investment strategies is crucial to navigating the uncertainties.

*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.

Lack of triggers and profit booking led major global indexes to end the week lower. This pullback might be due to investors strategizing their future moves or waiting for more data to make informed decisions.

The global IT outage on Friday had minimal impact on stock markets worldwide.

Crude oil prices fell during the week, with Brent Crude dropping 2.85% to settle below $87. Meanwhile, gold experienced upward pressure, rising 2.95% and reaching a new all-time high.

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

US Markets

The US market was mostly flat during the week and witnessed heavy profit booking tech stocks as investors diversify from tech giants. Experts beleive financials and energy may see increased interest. Investors are now waiting for the Federal Reserve’s next move amid slowing down of inflation.

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

Dow Jones

Dow Jones fell amid a broad pullback in the equity markets. Overall the sentiment of the market is a bit negative. On Friday, the index pulled back by 0.93%, and on a week-on-week basis, the index was up by 0.72%. 

S&P 500

The SP500 index pulled back on Friday’s session as traders focused on a global IT outage caused by a Crowdstrike software update. It was down by 0.71%. The index is currently testing for support at the 5500 level. On a week-on-week basis, the index was down by 1.97%. 

Nasdaq

NASDAQ fell to new lows as traders continued to sell tech stocks in the midst of a global IT outage while diversifying their portfolios. On Friday, the index was down by 0.81% and concluded the week with a cumulative loss of 3.65%. 

European Markets

The European Central Bank (ECB) kept its key interest rate unchanged at 3.75% at its most recent meeting, which was on expected line. It stated that it would not offer anguidance to specific rate paths and that economic data would guide its decisions. 

ECB President Christine Lagarde said a September move was wide open, adding that risks to economic growth were “tilted to the downside” and that inflation would remain stable for the rest of the year before falling in the second half of 2025.

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

FTSE 100

Despite improving economic indicators, the FTSE 100 lost its positive momentum, giving up its gains from the previous week. The UK GDP increased by 0.4% in May, following zero growth in April. On a rolling three-month basis, the economy grew by 0.9%, its fastest rate since 2022.

On Friday’s session, the index was down by 0.60% and on a week-on-week basis, it was down by 1.18%. 

CAC 40

Political and economic uncertainty have impacted Europe’s third-largest stock market. Following the cues from the global market, CAC 40 was down by 0.69% on Friday’s session and on a week-on-week basis, it fell by 2.46%.

DAX

Slowing economic growth continues to be a challenge for the German economy. The IMF has predicted Germany’s economy to grow by 0.2% in 2024, and 1.3% in 2025. On Friday, the index closed 1.01% lower and on a week-on-week basis, it was down by 3.07%. 

Asian Markets

Following the cues from the US and European market, most of the Asian indexes traded lower during the week. Also, domestic factors influenced the market. Let’s take a closer look at how the various Asian indices performed over the week. 

Nifty 50

Profit booking on Friday wiped out most of the week’s gains. The market rose at the start of the week due to better-than-expected performance by IT companies but lost ground as profit booking took place. On Friday, the Nifty 50 fell 1.09%, while it rose 0.40% week on week. 

Nikkei 225

Japan’s stock markets fell over the week. Technology stocks fell as investors became concerned about tighter US restrictions on advanced semiconductor technology exporters to China, including several Japanese chip makers. On Friday, Nikkei 225 was down by 0.16% and on a weekly basis, the index was down by 2.74%. 

Straits Times

Singapore’s primary stock market index was down by 0.68% on Friday and on a week on week basis, it ended the week lower by 1.44%.

Hang Seng

Weaker than expected economic growth kept the Chinese stocks under pressure. In Hong Kong, the benchmark Hang Seng Index retreated by 2.07% in Friday’s session, and on a week-on-week basis, the index recorded a cumulative loss of 4.79%. 

Taiwan Weighted

Following the cues from the global market and its Asian peers, Taiwan Weighted index fell by 2.31% in Friday’s session. On a weekly basis, the index was down by 4.38%.

KOSPI

KOSPI, South Korea’s primary stock market index, fell 1.03% on Friday, maintaining the bearish trend. On a weekly basis, the index fell 2.15%.

SET Composite

Thailand’s equity market index, SET Composite extended losses during Friday’s session, and was down by 0.58%. On a week-on-week basis, the index fell by 1.12%.

Jakarta Composite

The Indonesian stock market failed to continue the upside momentum and was down by 0.36% on Friday’s session. Weekly, the index fell by 0.45%.

Shanghai Composite

Chinese stocks rose as investor sentiment remained largely unaffected by slower-than-expected economic growth in the second quarter. The Shanghai Composite Index rose 0.17% on Friday’s session, and on a week-on-week basis, it was up by 0.37%. 

Wrapping Up

Looking ahead, the current pullback in global markets paints a mixed picture. While the lack of immediate triggers and profit booking has caused major indexes to end the week lower, it also suggests that investors are reevaluating their strategies, possibly waiting for more data before making informed decisions. 

As we move forward, the focus will be on key economic indicators and central bank decisions, which are likely to influence investor sentiment and market direction. Keeping an eye on these developments will be critical for navigating the markets over 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 global market sentiment was positive throughout the week, with the top US indices reaching new highs, the European market reversing its downward trend, and Asian indices trading with a positive bias due to the overall improvement in global economic conditions. 

Crude oil prices remained largely stable and closed the week flat, with Brent Crude trading around the $87 mark. However, gold experienced upward pressure and ended the week up 3.64%. 

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

US Markets

Several factors supported the US market this week, the most important of which was a slowing of inflation. Consumer prices dropped for the first time in four years. In June, headline prices fell by 0.1%, while core prices rose by 0.1%, the slowest pace in three years.

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

Dow Jones

A broad rally in the equity markets pushed the Dow Jones to record highs this week, breaking above 40,000 for the first time. The index was up 0.62% on Friday, ending the week up 1.59%.

S&P 500

Traders reacted to the positive CPI numbers, which helped the S&P500 index test new highs on Friday. The index was up by 0.55% and settled above the crucial 5650 level at the close of Friday’s session. On a week-on-week basis, it was up by 0.87%. 

Nasdaq

Tech stocks witnessed a volatile session this week due to profit booking, but they managed to close the week on a higher note. On Friday’s session, the Nasdaq was up by 0.63%, concluding the week 0.25% higher. 

European Markets

Despite the ongoing political uncertainty in Europe, the markets traded with a positive bias, influenced by the US markets and improving economic indicators in Europe.

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

FTSE 100

UK GDP grew by 0.4% in May, after reporting zero growth in April. The uptick was driven by growth in services and construction output. On a rolling three-month basis, the economy grew by 0.9% , the fastest pace since 2022. In Friday’s session, FTSE 100 was up 0.36%, but concluded the week with a cumulative gain of 0.60%. 

CAC 40

Positive momentum continued throughout the week, ignoring the country’s political uncertainty. CAC 40, the primary stock exchange of France, rose by 1.26% on Friday, and on a week-on-week basis, it closed 0.63% higher. 

DAX

Overall, strength in the German equity market helped the DAX conclude the week on a higher note. On Friday, the index closed 1.14% higher, and on a week-on-week basis, it was up by 1.48%. 

Asian Markets

Taking cues from the US and European markets, most Asian indexes traded on a positive note during the week. Domestic factors also influenced the market. Let’s take a closer look at how the various Asian indices performed over the week. 

Nifty 50

Profit booking, concerns over valuation, and the start of the corporate earning season kept the market highly volatile but closed the week higher. In Friday’s session, Nifty 50 was up by 0.77%, which helped the index to close the week on a positive note and was up by 0.73. 

Nikkei 225

At the end of the week, Japanese stocks retreated from their record highs reached on Thursday. Nikkei 225 fell by 2.51% on Friday, pulling down the overall weekly gain to 0.68%. 

Straits Times

Throughout the week, Singapore’s primary stock market index remained bullish. It increased by 0.65% on Friday and nearly 2.55% week on week to end the week positively. 

Hang Seng

Strong export data in June and China’s consumer price index rising a lower-than-expected 0.2% from a year earlier, narrowing from May’s 0.3% rise, helped lift the Hang Seng index. The index rose 2.52% on Friday and 2.77% week over week. 

Taiwan Weighted

The Taiwan Weighted index had a mixed week. On Friday, it was down by 1.98%, bringing its weekly cumulative gain to 1.53%.

KOSPI

KOSPI fell 1.20% on Friday, breaking a streak of five consecutive weeks of gains. On a weekly basis, the index fell by 0.18 percent.

SET Composite

Thailand’s equity market index, SET Composite, reported a modest gain on Friday’s session and was up by 0.20%. On a week-on-week basis, the index rose by 1.53%.

Jakarta Composite

The Indonesian stock market maintained its upward trend and rose throughout the week, reaching a 0.37% high on Friday. The index increased by 1.48% weekly.

Shanghai Composite

Shanghai Composite failed to capture the positive economic indicators released on Friday. The index traded flat on Friday and gained 0.46% by the end of the week. 

Wrapping Up

The encouraging economic indicators from the United States and Europe helped the global stock market trade on a high note. Moving forward, the announcement and reporting of corporate earnings are likely to influence market trends. To successfully navigate changing market dynamics, it will be necessary to closely monitor economic and corporate earnings reports, as well as sector-specific performance.

*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.

Dovish Fed and better-than-expected non-farm payroll data have increased investors’ confidence in the US stock markets. During a congressional hearing, Fed Chair Jerome Powell suggested that the US economy is no longer overheated and has cooled significantly from its pandemic-era extremes. The case for a rate cut is stronger. 

Investors are now looking towards the upcoming inflation report, and if it is as expected, it would further strengthen the case for a rate cut in the next policy meeting. The overall inflation trend is downward; however, one of the key concerns is the rise in crude oil prices in recent months. Year-to-date, crude oil prices are up by more than 12%. 

US stock market index performance during the week

Nasdaq 100

Nasdaq continued its upside momentum due to strong demand for AI and semiconductor stocks but also witnessed some profit-taking. On Tuesday (9th July 2024), Nasdaq 100 traded mainly with a positive bias but concluded the day flat. The index is up by more than 3.5% in the last five trading sessions. The index is one of the top-performing indexes in the US market and has gained by 23.6% to date in 2024. 

Looking at the daily chart, the overall momentum continues to be strong. It has broken above the 20,000 level with enough strength and is currently trying to break above the 20,500 level. As the index is in uncharted territory, hitting new record highs, the market will continue to test for new support below. 

S&P 500

In Tuesday’s session, Powell’s remark on rate cuts and the economy sent the broader S&P 500 index to a record high. The index is trying to climb above the 5,600 level. 

On Tuesday (9th July 2024), the S&P 500 concluded the day flat, but the index has gained more than 2.1% in the last five trading sessions. The index’s year-to-date performance has been quite bullish, up 17.59% in 2024. 

The S&P 500 is currently trading in uncharted territory and faces strong resistance at the 5,600 level. Strong support is at the 5,450 level, and if it breaks below this level, the index could witness more selling and test the 5,380 level. 

Top Gainers and Losers in the US Stock Market

The index’s top gainers continue to skew towards technology stocks, which have been the primary source of all market gains in 2024. 

Top Gainers

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

Top Losers

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

The top gainers in the index continue to skew towards the technology stocks, which have been the primary source of all gains in the market in 2024. Tesla stock is rising because of the better than expected second quarter deliveries, growth in the company’s battery storage business, and growing optimism about its AI business. While, Applied Materials is benefitting from the growing optimism around semiconductor stocks. 

On the other hand, energy stocks such as Marathon Petroleum and Exxonmobil are under selling pressure due to a weak growth outlook in these sectors and low investor confidence. Low retail spending and demand have recently impacted consumer-driven business stocks. 

Conclusion:

As the current upside momentum in the US market is mainly driven by the rally in AI and tech-related stocks, the valuations of such stocks have become a concern. In the event of a rate cut by the Fed, sectors such as consumer services, consumer durables, and retail trade will further push the market higher. 

When comparing the performance of the US and Indian markets, the US market continues to outperform in terms of short and long-term returns. The only difference is that while tech stocks are driving the rally in the US stock market, nearly all sectors of the economy are participating in India.

*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.

Mixed cues from the developed market led to increased volatility in the Asia stock markets in the past week. However, momentum in the market is largely positive despite the strength in the dollar index and crude oil price, which can hurt the economic recovery. 

Top Asia stock market indexes performed during the week. 

Nikkie 225

After a positive start in 2024, the Japanese market is struggling to continue its upside-positive momentum due to a slowdown in the country’s economic recovery. In June 2024, the country’s services activity contracted for the first time in two years. Au Jibun Bank Services PMI data slipped from 53.8 in May to 49.4 in June. The expansion in services activity offset the contraction in manufacturing activity. 

This is leading to reduced investor bets on a July Bank of Japan rate hike. The growth in the services sector is very crucial for Japan’s economy at this stage because the sector contributes about 70% to the Japanese economy. 

The week starting 1st July 2024, Nikkei 225 has been trading with a positive bias. This Asia stock index was up by around 3.2% in the last week.

The daily chart of the Nikkei 225 index shows that the 41,000 level has become a strong resistance zone, while the 39,000 level offers immediate support. Currently, the market lacks momentum, and a break below the key support level could send the index below 35,000. 

The top gainers in the Nikkei 225 index are Mitsubishi Ufj Financial Group, Tokio Marine Holdings Inc., and Ms&Ad Insurance Group Hldgs. The top losers are Bridgestone Corp, Nidec Corporation, and Japan Post Holding Co. 

Hang Seng

The rally in tech stocks and the real estate sector has resulted in Hong Kong stocks making a positive start to the week starting 1 July 2024. 

In China, the home sales downturn has slowed down through policy intervention. According to preliminary data from the China Real Estate Information Corporation, home sales have jumped 36% from May. However, Mainland China markets continue to struggle. 

Looking at the daily chart of Hang Seng, the index has bounced higher from its key support level of 17,570. If the positive momentum persists, the next major resistances are at 18,200 and 18,600. 

Top gainers in the Hang Seng are PetroChina Co, China Resource Land, and China Petroleum & Chemical Corp. The top losers are Nongfu Spring Co Ltd, China Merchants Bank Co Ltd, and China Shenhua Energy Company Ltd.

Nifty 50

The Indian stock market continues to rise higher on the back of strong interest from FIIs in the month of June. The FIIs bought Indian equities worth Rs 26,000 crores in June and all eyes are towards the budget, which is expected around July 22nd. Last week, both the Nifty 50 and Sensex hit fresh record highs. In the last five trading sessions, the Nifty 50 has been up by 1.81%. 

Looking at the daily chart of Nifty 50, the Relative Strength Index shows that the upside momentum continues to be very strong. However, Nifty 50 is experiencing a bit of profit booking from the top. There is resistance at around 24,200, while the 23,600 level is expected to provide strong support. 

The top gainers in the Nifty 50 index are HDFC Bank, Wipro, Reliance, Infosys, TCS, Tata Motors, etc. The top losers are Shriram Finance, Bharti Airtel, Bajaj Auto, Mahindra & Mahindra, etc. 

*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.

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