Throughout the week, the global indices displayed a mixed performance. While the US market saw some profit booking in tech stocks resulting in flat performance, European and Asian markets remained predominantly positive. Investors largely overlooked concerns regarding the UK and Japanese economies potentially entering a technical recession. Despite improving macro conditions globally, investors are keeping a cautious eye on evolving geopolitics and energy prices.
A snapshot of the major world market indices this week
| Index | Previous Day Change (%) | WoW Change (%) |
| US Markets | ||
| Dow Jones | -0.40 | -0.14 |
| S&P 500 | -0.47 | -0.41 |
| Nasdaq | -0.78 | -1.30 |
| European Markets | ||
| FTSE | 1.48 | 1.84 |
| CAC | 0.32 | 1.58 |
| DAX | 0.41 | 1.13 |
| Asian Markets | ||
| Nifty 50 | 0.59 | 1.10 |
| Nikkei 225 | 0.86 | 4.31 |
| Straits Times | 1.40 | 2.67 |
| Hang Seng | 2.42 | 3.77 |
| Taiwan Weighted | 0.20 | -0.15 |
| KOSPI | 1.32 | -0.03 |
| SET Composite | -0.07 | -0.15 |
| Jakarta Composite | 0.44 | 0.52 |
| Shanghai Composite | 1.26 | 3.43 |
World Stock Market Index: US Markets
Following the release of higher-than-expected inflation numbers later in the week, major US stock indices experienced some selling pressure, raising concerns about the Federal Reserve’s rate cut timeline. Additionally, Nike’s announcement of a 2% workforce layoff raised concerns about the demand for discretionary products, particularly impacting consumer discretionary stocks throughout the week.
Dow Jones
Dow Jones Industrial Average (DJIA) experienced selling pressure during Friday’s session, declining by 0.40% and closing the week with a marginal loss of 0.14%.
S&P 500
Despite the profit booking, the S&P 500 index is successfully holding above the 5,000 level, which it broke for the first time last week. In Friday’s session, the index was down by close to 0.50%, and closed the week with a cumulative loss of 0.41%.
Nasdaq
The tech-heavy Nasdaq index was the most affected, with traders prioritizing profit-taking in tech stocks that had seen significant gains in recent weeks. During Friday’s session, the index declined by 0.78%, resulting in a total weekly loss of 1.30%.
World Stock Market Index: European Markets
Despite mixed economic indicators, European markets remained largely positive throughout the week. The news of the UK entering recession, European commission reducing growth forecast in 2024, narrowing of the European trade surplus failed to impact the positive investor sentiment.
FTSE
FTSE, the UK’s blue-chip stock index, gained 1.48% in Friday’s session, and closed the week with a cumulative gain of 1.84%. The fall in people spending in the last quarter of 2023 resulted in larger than expected contraction in the growth of the economy. It was the second consecutive fall in quarterly growth in 2023. For the whole of 2023, the UK economy grew by 0.1%, weakest since 2009, excluding the Covid year.
CAC
CAC 40, the French stock market index was up by 0.32% during Friday’s session, and concluded the week with a cumulative gain of 1.58%. Hopes of slight growth in Q1 of 2024, after stagnation in 2023 has resulted in improved market sentiment.
DAX
DAX, which tracks the 40 largest German companies, continued its positive momentum, making new highs during the week. The index gained 0.41% in Friday’s session, and posted a weekly gain of 1.13%. Germany has officially become the third-largest economy, overtaking Japan.
World Stock Market Index: Asian Markets
The news of Japan entering recession and concerns relating to the slowdown in the Chinese economy dominated the Asian market. However, despite the negatives, major stock indices were largely positive, barring few during the week.
Nifty 50
The Nifty 50, India’s benchmark index, experienced profit booking during the week, leading to subdued momentum. However, amidst concerns about growth in other major economies, the Indian economy emerged as a bright spot, boosting investor optimism regarding returns. On Friday, the index increased by 0.59%, resulting in a weekly gain of 1.10%.
Nikkei 225
Shedding the concerns of recession, investors continue to pour money into the Japanese stock market. Nikkei 225 is now trading closer to its 34 year peak. In Friday’s session, the index gained 0.86% and posted a weekly gain of 4.31%.
Straits Times
The optimistic sentiment in the region, coupled with positive expectations for the budget, propelled STI higher in Friday’s session. The index surged by 1.4% on Friday and recorded a weekly gain of 2.67%.
Hang Seng
Despite the economic worry, bullish sentiment around tech stocks pushed the index higher during the week. The index gained 2.42% on Friday’s session and recorded a weekly gain of 3.77%.
Taiwan Weighted
The index struggled to maintain the previous week’s positive momentum, experiencing a slight decline due to losses in US tech stocks and concerns about inflation. However, on Friday, the market rebounded with gains of 0.2%, mitigating the weekly decline to just 0.15%.
KOSPI
On Friday, the South Korean index, KOSPI, surged by 1.32%, nearly offsetting the losses incurred earlier in the week. Overall, the index ended the week almost unchanged, with a marginal loss of just 0.03%.
SET Composite
Thailand’s primary index, the SET Composite, traded flat this week as investors awaited clear market direction. It traded flat on Friday, losing 0.07%, and fell 0.15% week on week.
Jakarta Composite
This Indonesian index traded on a positive note during the week, amidst the presidential election that was held on February 14th. Jakarta Composite gained 0.44% on Friday’s session and was up by 0.52% week-on-week.
Shanghai Composite
Despite the economy’s ups and downs, China’s benchmark index, the Shanghai Composite, maintained a positive bias. It increased by 1.26% on Friday, and the index has gained 3.43% in the last week.
Wrapping Up
The market faced headwinds from higher inflation in the US, increasing treasury yields, and slowing growth in Europe. Despite these challenges, markets have shown resilience, maintaining gains with reduced volatility. The upcoming weeks’ inflation data from the US and economic indicators from Europe will likely guide market direction in the medium term. Investors should remain cautious, as any slip in managing the inflation could potentially disrupt global growth and stock market returns.
