Global Indices Rally On The Back Of Political Moves

On a wave of buoyancy, Nasdaq and S & P 500 touched fresh highs and gained 2.82 per cent and 1.25 per cent, respectively, during the fortnight. The S & P 500 index has climbed for seven consecutive months, the longest winning streak since January 2018. A robust corporate earnings’ season and continued central bank support has helped stocks in the US hit record highs over the past few weeks. Dow Jones ended flat, gaining a mere 0.09 per cent over the fortnight. Federal Reserve Chair Jerome Powell said in his remarks for the Jackson Hole symposium that the central bank could begin withdrawing some of its easy money policies.

It may also reduce its monthly bond purchases before the end of the year. However, they won’t be in a hurry to begin raising interest rates immediately thereafter. The hiring in United Stated downshifted abruptly in August 2021 with the smallest jobs’ gain in seven months, complicating a potential decision by the Federal Reserve to begin scaling back monetary support in the coming months. As per the Labour Department report, non-farm payrolls increased by 2,35,000 last month after an upwardly revised 1.05 million gain in July. The unemployment rate fell to 5.2 per cent.

London’s FTSE 100 index climbed 0.41 per cent over the fortnight. The blue chip index gained 1.2 per cent during August, recording its best monthly performance since April on the back of easing fears of early tapering by the US Federal Reserve and healthy earnings. Year-to-date the index has gained 10.2 per cent and continues to underperform its peers. Germany’s DAX benchmark stock index lost 0.45 per cent during the fortnight.

But the talk of the town is that the DAX index is expanding from 30 stocks to 40 stocks. This is the biggest overhaul in the benchmark’s 33 years’ history. J P Morgan Chase and Co. predicts the additions will include faster-growing, highly valued companies. German carmaker Porsche and sportswear maker Global Indices Rally On The Back Of Political Moves Global Market Watch DS Puma could be the possible candidates to join the index. Hang Seng, Nikkei and Shanghai indices bounced back, rallying 3.24 per cent, 5.94 per cent and 3.01 per cent, respectively, over the fortnight.

Nikkei’s rise was also fuelled by the news that the current Prime Minister Yoshihide Suga will not be running in the upcoming leadership election. Korea’s exports last month jumped 35 per cent on an annual basis on the back of continued global demand for chips and automobiles. The Kospi index climbed 3.59 per cent during the fortnight to end at 3,201.06. The OMX Copenhagen 20 dipped by 1.65 per cent while S & P | ASX 200 jumped by 0.44 per cent. The SET index rallied by 4.31 per cent while Singapore’s Straits Times index shrunk by 0.12 per cent over the fortnight.