This report is from today’s TNC’s Daily Open, our international markets update. TNC Daily Open keeps investors informed on everything they need to know, no matter where they are.
What To Note Today
The Nasdaq Performs Better Than
U.S. stocks had a mixed finish on Friday. For the sixth day in a row, the Dow Jones Industrial Average fell 0.2%. With a 24% increase in shares, Broadcom entered the trillion-dollar valuation club. Asia-Pacific markets saw a general decline on Monday, reversing earlier gains. The region’s worst losses were caused by Hong Kong’s Hang Seng index, which fell by almost 0.9%.
Bank Of Japan Is Anticipated To Keep Rates
During its meeting on Wednesday and Thursday, the Bank of Japan is expected to maintain its current benchmark interest rates, according to a TNC survey. Thirteen of the twenty-four experts surveyed believe that the BOJ will not raise interest rates in December. Rates were last hiked by the BOJ in July.
Chinese Buyers Are Delaying Purchases.
Retail sales in China increased by 3% in November compared to the same month last year, according to figures released Monday by the National Bureau of Statistics. That number is much lower than the 4.8% growth seen in October and fell short of the 4.6% gain predicted by a Reuters poll. However, China’s Singles’ Day shopping extravaganza helped boost October’s sales.
President Of South Korea Impeached
On Saturday, 204 members of the National Assembly voted in favour of impeaching South Korean President Yoon Suk Yeol. Han Duck-soo, the prime minister, will act as president. In a conversation with U.S. President Joe Biden on Sunday, Han stated that the nation’s finance ministry would keep an eye on the markets.
Focus On Rates And Prices.
This week’s focus is on inflation and interest rates. The personal consumption expenditures price index, the Fed’s favoured indicator of inflation since it represents how consumers actually spend their money, is released on Friday, while the U.S. Federal Reserve’s rate-setting meeting concludes on Wednesday.
Bottom Line
Making a prediction and then ignoring it is a near-certain way to anticipate where markets are going.
Last week, the S&P 500 may have lost 0.6%, ending its three-week winning run. However, it has risen nearly 27% so far this year and broke beyond the 6,000 mark for the first time.
That’s far higher than what leading financial analysts predicted at the end of 2023, for example, Dubravko Lakos-Bujas, chief U.S. equity strategist at JPMorgan, predicted that the broad-based index would end the year at just 4,200. The fervent market rally this year was not reflected in even the most bullish forecast, which was set at 5,200 by John Stoltzfus, chief investment strategist at Oppenheimer.
Because of this, investors should be sceptical of market strategists’ predictions that the S&P will close 2025 at 6,630, as per the average prediction from the TNC Market Strategist Survey. It’s true that investors are feeling optimistic due to a number of reasons, including Trump’s strong admiration for the stock market as a gauge of his presidency, his gradual easing of monetary policy, and the possibility of lower corporate taxes.
However, as in reality, even the best-laid plans of men and mice frequently fail in markets.
Trump’s proposed tariffs and the potential tit-for-tat trade battles could force inflation to make an unwanted comeback, much like measles and possibly polio in the United States. In fact, Robert Kaplan, the former president of the Dallas Fed and vice chairman of Goldman Sachs, stated that inflation already “looks a little stuck.”
I would still love it if Savita Subramanian of Bank of America turned out to be an accurate market forecaster, even though I am sceptical of predictions. Imagine the S&P reaching Subramanian’s target of 6,666 by the end of 2025.