Global markets extend 2018 rally with fresh records
NEW YORK, United States (AFP) — The 2018 global equity rally continued apace Friday, with Asian and European markets posting healthy gains and Wall Street powering to fresh records once again.
One day after the Dow finished above 25,000 for the first time, the blue-chip index moved higher still, picking up momentum throughout the day before finishing at 25,295.87, up nearly one per cent.
The rise came despite a disappointing US jobs report. The US added just 148,000 jobs in December, the Labour Department reported, far below expectations, although unemployment held steady at its 17-year low of 4.1 per cent.
But investors, who opened 2018 in a fever pitch to buy equities, were unfazed by the lackluster data, much as they have also overlooked any concerns about US-North Korea tensions or domestic political controversies.
“Whatever the news, the reaction thus far continues to be more of what we have been seeing,” said Adam Sarhan, founder of 50 Park Investments.
“Investors are buying, dismissing all negative news, whether economic or geopolitical and they are just buying stocks.”
All main European markets were higher at the close, with standout Frankfurt clocking up a gain of just under 1.2 per cent despite a share price plunge for heavyweight Deutsche Bank after a profit-warning.
Paris followed not far behind with a 1.1 per cent rise.
London hit a new intra-day record peak at 7,727.73 points, and also set a new closing high, buoyed by the weak pound, which lifts the share prices of multi-national companies.
In Asia on Friday, Tokyo stocks ended up 0.9 per cent at a 26-year high following its more than three percent jump Thursday, while Sydney added 0.7 per cent.
Seoul rose 1.3 per cent, with dealers buoyed by news that North Korea had accepted the South’s offer of talks next week, further easing geopolitical tensions in the region.
Hong Kong gained 0.3 per cent to chalk up a ninth-straight gain.
ECONOMIC STRENGTH
Equity optimism has been fuelled by US tax cuts, healthy corporate profits and strong manufacturing figures worldwide.
Greg McKenna, chief market strategist at AxiTrader, said in a note that data from the manufacturing and services sectors “suggests economic strength across the globe remains robust.”
He noted that an index of world factory activity was at its highest level in seven years.
While oil prices inched down, they remain elevated after recent rises to around three-year highs thanks to Middle East tensions.
Crude futures have also been boosted this week on keen US demand as the nation’s stockpiles fall on the back of a severe cold snap.