Stocks Bounce, Yen Slides Tracking Inflation Fallout
Fahad Shabbir (@FahadShabbir) Published January 21, 2023 | 05:55 PM
Stock markets rebounded on Friday after a rocky week dominated by uncertainty over whether the global economy will suffer recession this year as inflation remains stubbornly high
London, (UrduPoint / Pakistan Point News - 21st Jan, 2023 ):Stock markets rebounded on Friday after a rocky week dominated by uncertainty over whether the global economy will suffer recession this year as inflation remains stubbornly high.
Traders are weighing poorly received US economic data and earnings against an expected boost from China's reopening after three years of painful Covid lockdowns.
"Having seen such a strong start to the year, there was always the probability that we'd see a little bit of profit taking," said market analyst Michael Hewson at CMC Markets.
"However, that doesn't mean that the ... optimism that has been the hallmark of this early year rebound is evaporating, and that we might start to see a sharp move lower." On currency markets, the yen slid one percent against the dollar, even as data showed Japanese inflation hit a four-decade high.
Analysts are not convinced that despite rising prices, the Bank of Japan will start to raise interest rates.
Oil prices meanwhile extended Thursday's gains as investors focused on the recovery in demand from China. Suggestions that the country's Covid infections may have peaked added to the optimism among commodity traders.
"The over-arching concerns of a global slowdown remain, even though ... investors are still pinning their hopes on a significant boost from the reopening in China," noted Richard Hunter, head of markets at Interactive Investor.
"This possible division of prospects between Asian and other economies is propping up Chinese markets in particular, albeit amid a rocky start to the year." Google's parent company Alphabet on Friday announced plans to axe about 12,000 jobs worldwide. Its shares climbed more than four percent in late morning trading.
The move came a day after Microsoft said it would reduce staff numbers by 10,000 in the coming months.
Similar layoffs by Facebook owner Meta, Amazon and Twitter have also been announced as the previously unassailable tech sector faces a major economic downturn.
"Digital spending is suffering and ad revenues are falling with it, prompting tech companies, which not long ago were the darlings of the stock market, to reduce labour costs in preparation for the economic downturn," said Victoria Scholar at Interactive Investor.
On the upside, US streaming giant Netflix said it ended last year with more than 230 million global subscribers. It beat analysts' expectations as hits such as "Wednesday" and "Harry & Meghan" enticed new viewers.
Netflix became a publicly traded company in early 2002 at an opening price of $15 a share.
Shares in the streaming service jumped more than seven percent to $337.48 in late morning trading on Friday.
Wall Street's main indices opened higher, with the Dow edging up two-hundredths of a percent. The broader S&P 500 index added 0.4 percent while the tech-heavy Nasdaq Composite rose 0.7 percent.
In Europe, London stocks edged 0.2 percent higher in afternoon trading. Frankfurt and Paris both added 0.5 percent.
- Key figures around 1630 GMT - New York - Dow: UP 0.6 percent at 33,232.82 points EURO STOXX 50: UP 0.6 percent at 4,119.90 London - FTSE 100: UP 0.3 percent at 7,770.59 (close) Frankfurt - DAX: UP 0.8 percent at 15,033.56 (close) Paris - CAC 40: UP 0.6 percent at 6,995.99 (close) Tokyo - Nikkei 225: UP 0.6 percent at 26,553.53 (close) Hong Kong - Hang Seng Index: UP 1.8 percent at 22,044.65 (close) Shanghai - Composite: UP 0.8 percent at 3,264.81 (close) Dollar/yen: UP at 129.84 yen from 128.40 yen on Thursday Euro/dollar: DOWN at $1.0841 from $1.0833 Pound/dollar: DOWN at $1.2381 from $1.2392 Euro/pound: UP at 87.551 pence from 87.39 penceBrent North Sea crude: UP 0.8 percent at $86.83 a barrelWest Texas Intermediate: UP 0.6 percent at $81.08 a barrel
Related Topics
Recent Stories
Govt committed to developing gems, jewellery sector: Minister
Three new bills introduced in Senate
Nine dead, 1,318 injured in Punjab road accidents
Ukraine, Russia exchange fire, at least seven dead
1st-ever National Sports Revival conference starts next month
Joint venture decided for action against MEPCO’s defaulters
Modern irrigation system imperative to deal with water scarcity: UAF VC
Bringing 4.4mln hectares suitable land under olive cultivation to address econom ..
One woman died after speedy bus overturned
155 killed in Tanzania as heavy rains lash East Africa
Parliament committed to resolve public issues on priority basis: Ghulam Mustafa
Collaborative Care of Diabetes Centre inaugurated in Faisalabad
More Stories From Business
-
Collaborative Care of Diabetes Centre inaugurated in Faisalabad
40 minutes ago -
Kazakh envoy stresses quantum jump in bilateral trade
33 minutes ago -
Thousands of flights scrapped as French air traffic controllers strike
38 minutes ago -
SECP proposes amendments to General Takaful Accounting Regulations, 2019
38 minutes ago -
Govt committed to developing gems, jewelry sector: Minister
49 minutes ago -
Pakistan earns $1,976 million from IT services' export in 8 months
2 hours ago
-
Turkey central bank holds key interest rate steady
32 minutes ago -
PSX loses 80 points
2 hours ago -
Ahad Cheem lauds UNDP’s cooperation
2 hours ago -
Rupee sheds 09 paisa against dollar
32 minutes ago -
Chinese tech behemoth enters game amid global EV surging trend
32 minutes ago -
London stocks hit new record on blockbuster mining takeover bid
3 hours ago