All three major US indices closed in the green on Thursday, with the broad S&P 500 Index entering bull market territory as it closed 20% above its October low, as mega-cap shares continued to power ahead.  The Dow Jones gained over 160 points while the Nasdaq climbed 1%.  Investors digested hotter-than-expected jobless claims data while awaiting inflation data and the FOMC meeting next week.  Elsewhere, European shares ended yesterday’s session marginally higher, as gains made by auto shares offset losses by telecom companies.  Meanwhile, economic data showed that the Eurozone economy slipped into recession during the winter period due to the impact of rising prices on consumer spending. 

Summary for 09.06.2023 

  • Most Asian equities advanced on Friday, led by technology-heavy indices such as South Korea’s Kospi and the Taiwan Weighted Index, as weak US labor data ramped up bets on a pause in the Federal Reserve’s rate hike cycle, although disappointing inflation readings from China capped broader gains.  Japan’s Nikkei 225 and Topix were the best performers for the day, up 1.7% and 1.3%, respectively, and moving back towards 33-year peaks hit earlier in the week.   
  • European equity futures pointed to small gains when shares trade at the open on the back of the S&P entering a bull market. 
  • Oil prices extended losses into Asian trade on Friday amid persistent fears that slowing economic growth will erode demand this year, with dismal readings from China further denting sentiment.  Prices tumbled by almost 5% yesterday following news that the US and Iran reached a temporary nuclear agreement that would allow Iran to resume oil exports of around 1 million barrels per day.  However, both countries denied the report, causing oil prices to recoup most of Thursday’s losses. 
  • China’s producer price index for May fell for an eighth consecutive month, down 4.6%.  That was the fastest decline since February 2016 and bigger than the 4.3% fall expected by economists.  Meantime, the consumer price index rose 0.2% year-on-year, speeding up from a 0.1% rise in April but, missing a forecast for a 0.3% increase. 
  • The number of Americans filing for unemployment benefits jumped to 261k last week which included the Labour Day holiday, the highest figure since October 2021, and above market forecasts of 235k.  Figures for the previous week were revised slightly higher to 233k from an initial 232k.  It marks a third consecutive week of increases in the number of initial jobless claims, a sign the labor market strength may be fading. 
  • Amazon shares rallied by 2.5% yesterday after reports that Well Fargo initiated coverage of the company with an “overweight rating, saying the e-commerce company’s shares could rally more than 30% as it transitions to its regional fulfillment model. 
  • T-Mobile shares were upgraded to “outperform” from “peer perform” by Wolfe Research, which said the company represents a buying opportunity following a run of poor performance.  Its shares rose 3%.