The S&P 500 saw an increase of ~18% in 2023, however, the gains have not been linear. Instead, the overall stock market was on a roller-coaster ride of significant ups and downs because investor sentiments took a hit as a result of several signals. Since global indexes posted strong gains, the S&P 500 increased in 1H of the year, as the index rebounded from bear market lows due to the early signs of economic resilience, strong earnings season, and news and developments surrounding the artificial intelligence.
S&P 500 then gave up some of those gains in 2H of the year, as it saw 3 consecutive monthly declines for the months of August, September, and October. These declines were due to recession fears and the hawkish commentary from the US Federal Reserve. Investors earlier expected that interest rates might remain elevated for the longer period than earlier expected.
Yet since then, roller-coaster ride took a sharp turn once again. Through the end of Friday, November 24, S&P 500 saw 4 consecutive weekly increases as a result of encouraging economic data, which includes low October inflation, reassuring investors that the Fed’s rate-hiking campaign might end soon.
Since global indexes posted strong gains, Wall Street still expects that significant acceleration in S&P 500 revenue and earnings is in the offing. Collectively, these can improve the stock market’s performance.
On Friday, Asia-Pacific markets started lower as there were mixed economic data from throughout the region. Investors continued to analyse the China’s Caixin manufacturing purchasing managers’ index for the month of November, which exhibited that sector expanded.
As a result of slew of economic data, Australia’s S&P/ASX 200 was down by ~0.2% to end at ~7,073.2. With this, the index ended a 3-day winning streak. South Korea’s Kospi declined ~1.19%, leading the losses in the region to end at 2,505.01. The small cap Kosdaq fell by ~0.53% at 827.24. Elsewhere, Japan’s Nikkei 225 ended the day lower by ~0.17% at 33,431.51. However, the Topix mitigated the wider trend, by rising ~0.32% at 2,382.52.
Coming to India’s economic data points, the manufacturing activity saw a rebound off 8-month low to post the faster rate of expansion for the month of November, as per S&P Global. India’s manufacturing PMI came at ~56.0 for November, which was in line with Reuters forecast and higher than readings of 55.5 which were seen in October.