BANGKOK,— European stocks opened higher on Thursday, following a mixed performance in Asia after a retreat in Big Tech stocks on Wall Street.
According to the Associated Press, Germany’s DAX gained 0.7%, reaching 19,394.41, while France’s CAC 40 rose by 0.6% to 7,185.13. The UK’s FTSE 100 saw a modest increase of 0.2%, closing at 8,290.37. Futures for the S&P 500 and Dow Jones Industrial Average edged up by 0.1%, signalling a slight recovery ahead of the U.S. market’s Thanksgiving closure.
In Asia, Japan’s Nikkei 225 saw a 0.6% gain, rising to 38,349.06, while Australia’s S&P/ASX 200 advanced 0.5%, reaching 8,444.30. South Korea’s Kospi moved up by a negligible 0.1% to 2,504.67 after the country’s central bank implemented a quarter-point reduction in the benchmark interest rate to 3% to help combat a slowing economy. Despite this, the Bank of Korea also revised its growth outlook down, projecting 2.2% growth for 2024, and a further dip to 1.9% for 2025.
However, Chinese markets faced losses, with Hong Kong’s Hang Seng index dropping by 1.2% to 19,366.96, and the Shanghai Composite index declining by 0.4% to 3,295.70 as investors cashed in on recent gains.
Meanwhile, Wall Street’s Big Tech companies, including Microsoft and Meta, weighed on the broader market. On Wednesday, the Nasdaq composite, heavily weighted with tech stocks, fell by 0.6%, while the S&P 500 and Dow Jones Industrial Average lost 0.4% and 0.3%, respectively. The pullback in tech shares was attributed to investor concerns over high expectations for corporate earnings, coupled with inflationary pressures.
On the economic front, the U.S. Commerce Department reported a robust 2.8% annual growth rate for the economy in the third quarter, driven by strong consumer spending and a surge in exports. However, the latest earnings reports from major retailers have painted a mixed picture, with department store chain Nordstrom falling 8.1% after warning of a slowdown in sales, while Urban Outfitters surged 18.3% after surpassing analysts’ forecasts.
U.S. inflation data also showed signs of persistence, with the personal consumption expenditures (PCE) index, the Federal Reserve’s preferred measure, rising to 2.3% in October from 2.1% the previous month. This uptick suggests inflation may be stalling near the Fed’s 2% target, prompting speculation about future interest rate cuts. The Fed recently started lowering rates after hiking them to a two-decade high in 2023.
Crude oil prices saw minor declines, with U.S. benchmark crude falling by 28 cents to $68.44 per barrel, and Brent crude shedding 26 cents to $72.04 per barrel. In the currency markets, the dollar strengthened against the Japanese yen, rising to 151.90 yen from 151.12 yen, while the euro dipped slightly to $1.0547 from $1.0567.
With the U.S. market closed for Thanksgiving, trading activity was lighter, with many investors waiting for economic signals and central bank decisions that could shape the market’s direction in the coming weeks.