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
Focus Is On The U.S. Jobs Report
The December nonfarm payrolls report for the United States will be made public later Friday. Economists predict that the unemployment rate will stay at 4.2% and that there will be a 155,000 job increase, down from 227,000 in November. However, Goldman Sachs and Citigroup analysts predict that both figures will fall short of the average estimate.
America’s Markets Are Dark, As Europe’s Closes Higher
In remembrance of former US President Jimmy Carter, who passed away in late December at 100, U.S. markets were closed Thursday. After beginning the day lower, Europe’s regional Stoxx 600 index gained 0.42%. Amid a broader sell-off in shipping equities, Denmark’s Moller-Maersk sank 5.8% after U.S. dockworkers blocked a tentative labour agreement.
Fed Governor Feels December’s Decrease Should Be ‘Last Step’
The Fed’s December interest rate decrease should be the “final step in the policy recalibration phase,” according to U.S. Federal Reserve Governor Michelle Bowman. According to that, Bowman, a voting member of the Federal Open Market Committee, may be against more cuts this year. Speaking this week, several Fed members expressed greater optimism about rate cuts.
“Strategic And Capitalistic Options” Are Investigated By Ubisoft
On Thursday, the French video game developer Ubisoft announced that it had hired “leading advisors” to examine possibilities “in order to extract the best value for stakeholders.” In October, it was reported that Tencent and the Guillemot family, who founded Ubisoft, were considering acquiring the company. Ubisoft’s stock is at its lowest level in ten years, raising concerns about its future.
The Ideal Location For A Job Report
The U.S. economy is in a precarious situation between growth and inflation. The jobs report, released on Friday, highlights how challenging this balancing effort is. According to Goldman Sachs, Treasury yields may increase if it’s too hot; if it’s too cold, equities may be halted by concerns about a slowing economy. However, the S&P 500 might rise if the report is released at the ideal time.
Bottom Line
There is no respite for South Korea. The nation has experienced a terrible plane tragedy, martial law, the impeachment of its sitting and acting president, its second acting president (so far), and more in the last month.
What impact have those occurrences had on the Korean market?
Not much, based on the Kospi index. When impeached President Yoon Suk Yeol imposed martial law on December 3, the index, which measures all common companies listed on the Korean Stock Exchange, was lower than it is today.
Its tenacity can be linked to Korea’s political history and the prompt, possibly fortuitous, actions of the Bank of Korea.
In Korean history, Yoon and Han Duck-soo were the most recent two presidents to be impeached. Before them, Park Geun-hye was impeached in 2016 and ousted from power the following year, and Roh Moo-hyun was impeached in 2004 (though the court overturned the decision).
“Korean equities, at least, fared fairly well during the most recent one in 2016/2017,” stated Thomas Mathews, head of markets for Asia Pacific at Capital Economics. “Presidential impeachments aren’t unprecedented in Korea.”
Soohyung Lee, a member of the Bank of Korea’s Monetary Policy Board, told CNBC on January 2 that the uncertainty surrounding Korea’s last two impeachments “have subsided within three to six months,” meaning that “it’s possible that the political turmoil may not take as much of a toll on the country’s economy.”
Additionally, the measures of the Bank of Korea appeared to calm markets.
The BOK declared emergency measures to reduce market turbulence and calm markets the day after Yoon lifted martial law.
