Asian stock markets showed mixed results on Friday after China reported a fourth consecutive month of declining corporate profits in November, adding to concerns about the region’s economic health. Meanwhile, oil prices and U.S. futures also saw a downturn.
In Japan, Tokyo’s Nikkei 225 index rose by 1.8%, closing at 40,285.25, as the yen continued to weaken. The yen’s drop came after the Bank of Japan Governor suggested that interest rate hikes might be postponed, citing economic risks such as potential U.S. tariffs on imports. The dollar fell to ¥157.71 from ¥158.00, continuing its recent slide from levels below ¥150.
Hong Kong’s Hang Seng index edged down by 0.1% to 20,120.54, while the Shanghai Composite gained 0.5%, reaching 3,399.27. China’s National Statistics Bureau reported that industrial profits for November had fallen more than 7% year-on-year, marking a continuation of a broader downward trend, with a nearly 5% drop in profits for the January-November period.
South Korea’s Kospi dropped 0.8% to 2,410.35 after political unrest led to the country’s main opposition party submitting an impeachment motion against the acting president. The controversy stems from his refusal to fill three vacancies on the Constitutional Court ahead of the court’s review of rebellion charges against impeached President Yoon Suk Yeol.
In the U.S., stocks showed a mixed performance. The S&P 500 dipped less than 0.1% to 6,037.59, ending a three-day streak of gains, while the Dow Jones Industrial Average climbed 0.1% to 43,325.80. The Nasdaq composite fell 0.1% to 20,020.36. Trading volume was notably light as U.S. markets resumed after the Christmas holiday.
Stephen Innes of SPI Asset Management noted that U.S. equities were in a “holding pattern” due to thinner trading volumes. “Liquidity remains razor-thin, and market moves appear more about year-end housekeeping than aggressive positioning,” he commented.
Among the major U.S. tech stocks, semiconductor giant Nvidia saw a slight dip of 0.2%. Meta Platforms fell 0.7%, while both Amazon and Netflix lost 0.9%. Tesla, a prominent S&P 500 component, dropped 1.8%. However, some tech stocks fared better. Broadcom gained 2.4%, Micron Technology rose 0.6%, and Adobe saw a 0.5% increase.
Healthcare stocks offered a silver lining for the broader market. CVS Health gained 1.5%, and Walgreens Boots Alliance surged 5.3%, marking the largest gain among S&P 500 stocks. Retail stocks also saw gains, with Target up 3%, Ross Stores rising 2.3%, Best Buy gaining 2.9%, and Dollar Tree increasing by 3.8%. Analysts are keenly watching whether retailers can sustain strong holiday season sales, with the day after Christmas traditionally being one of the busiest shopping days of the year.
In the automotive sector, U.S.-listed shares of Japanese automakers Honda and Nissan rose significantly. Honda gained 4.1%, while Nissan jumped 16.4% after announcing that the two companies are in talks for a potential merger.
On the economic front, the U.S. Labor Department reported that applications for unemployment benefits remained steady, though continuing claims reached their highest level in three years.
Looking ahead, Wall Street is bracing for a series of key economic reports next week, including updates on pending home sales, home prices, construction spending, and manufacturing activity.
In commodity markets, U.S. benchmark crude oil fell by 4 cents, settling at $69.58 per barrel, while Brent crude lost 7 cents, closing at $72.78. The euro also weakened slightly, slipping to $1.0412 from $1.0424.
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