World shares largely rose on Monday, buoyed by expectations of new economic support from China’s leadership as they convened for a significant meeting aimed at revitalizing the nation’s economy.
Oil prices surged by more than $1 per barrel following OPEC+ nations’ announcement to extend production cuts through the end of the year. The reason for the decision was not disclosed, but it comes just ahead of the U.S. presidential election scheduled for Tuesday.
In electronic trading on the New York Mercantile Exchange, U.S. benchmark crude rose $1.41 to $70.90 a barrel, while Brent crude, the international benchmark, increased by $1.37 to $74.47 a barrel.
In Europe, trading showed mixed results, with Germany’s DAX slipping 0.1% to 19,228.81, and the CAC 40 in Paris edging down 0.1% to 7,401.11. In contrast, Britain’s FTSE 100 rose 0.3% to 8,199.56. Futures for the S&P 500 increased by 0.1%, while those for the Dow Jones Industrial Average fell by 0.2%.
The Standing Committee of China’s National People’s Congress is meeting this week, with analysts anticipating the government may unveil substantial spending initiatives to stimulate the economy, which has seen two consecutive quarters of growth fall below the government’s target of approximately 5% for the year. “Markets are alive with whispers of a fresh stimulus package, setting expectations sky-high and creating a buzz that’s hard to ignore,” noted Stephen Innes of SPI Asset Management.
In Asia, Hong Kong’s Hang Seng index gained 0.3% to 20,567.52, and the Shanghai Composite index rose 1.2% to 3,310.21. Tokyo markets were closed for a holiday, but Australia’s S&P/ASX 200 climbed 0.6% to 8,164.60, and the Kospi in Seoul surged 1.8% to 2,588.97. Taiwan’s Taiex advanced by 0.8%, while India’s Sensex fell 1.7%.
On Friday, U.S. stocks saw gains led by Amazon, although a surprisingly weak jobs report dampened the outlook. The S&P 500 rose 0.4%, rebounding from its worst day in eight weeks, while the Dow increased by 0.7%, and the Nasdaq composite climbed 0.8%.
U.S. Treasury yields rose following a report indicating that employers added only 12,000 workers to their payrolls last month—far below economists’ expectations of 115,000 and a significant drop from the 223,000 jobs added in September. Additionally, a separate report showed that U.S. manufacturing contracted more than anticipated, a sector particularly affected by the Federal Reserve’s decision to maintain interest rates at a two-decade high until September.
Market expectations remain strong for a quarter-percentage-point cut to the Fed’s main interest rate in the coming week. Despite the slowdown in the job market, optimism persists that the economy can avoid recession, supported by anticipated interest rate cuts. Overall, the economy has demonstrated more resilience than initially feared.
In currency markets early Monday, the dollar dipped to 152.17 Japanese yen from 152.42 yen late Friday, while the euro rose to $1.0894 from $1.0881.
Related topic:
How Does Inflation Affect the Stock Market?