The pan-European STOXX 600 surpassed its previous all-time high
Wall Street stocks finished at fresh record highs on Friday as inflation data came in slightly lower than expected, cooling down worries about the imminent tightening by the Federal Reserve. Against this backdrop, investors shrugged off weak third-quarter reports from Amazon and Apple. Amazon missed both earnings and revenue expectations for the third quarter while Apple’s quarterly revenue fell short of expectations amid larger-than-expected supply constraints on iPhones. On the positive side, Microsoft shares gained over 2% as the company surpassed Apple as the largest listed company in the world by market cap. As such, the S&P 500 and the Dow added 0.19% and 0.25%, respectively, while the Nasdaq rose 0.33%.
Today in Asia, equities were mixed, with the MSCI’s index of Asia-Pacific shares outside Japan dragging 0.4% lower by selling in Hong Kong after weekend data showed a sharper-than-expected contraction of Chinese factory activity. On the positive side, a sub-index for new orders rose to 51.4 from 50.8 in September. Meanwhile, Japan’s Nikkei 225 rose 2.3% to notch a one-month high after prime minister Fumio Kishida’s Liberal Democratic Party won a comfortable victory.
European stocks opened higher on Monday, kicking off November with fresh highs despite weak economic data. According to the official report, Germany’s retail sales dropped sharply by 2.5% month-on-month in September versus 0.6% expected and 1.1% last. On an annualized basis, retail sales came in at -0.9% versus 1.8% estimated. The pan-European STOXX 600 gained 0.8% in early trade, surpassing its previous all-time high.
In currencies, most pairs have settled in tight ranges to start the week after a strong rally in the greenback witnessed on Friday. EURUSD struggles below the 1.1600 figure where the 20-DMA lies. The euro lacks the recovery momentum after a sharp sell-off, especially as traders are gradually shifting their focus to the upcoming two-day Federal Reserve meeting that concludes on Wednesday. As such, the common currency will likely stay on the defensive in the near term.
