Optimism about lowering interest rates rises in global stocks

The main indices on Wall Street rose yesterday, with investors optimistic about the Federal Reserve (the US central bank) reducing interest rates early next year.

This is after data showed more signs of lax labor market conditions. The Dow Jones Industrial Average rose 120 points, or 0.3%, the Standard & Poor’s 500 Index rose 19.05 points, or 0.42%, while the Nasdaq Composite Index rose 95.17 points, or 0.67%. Private sector job creation slowed further in November, and wages showed their smallest growth in more than two years, ADP reported yesterday.

Companies added just 103,000 workers for the month, slightly below the downwardly revised figure of 106,000 in October, and exceeding the Dow Jones estimate of 128,000.

Along with the modest job growth came a 5.6% increase in annual pay, which ADP said was the smallest increase since June 2021. Job switchers saw pay increases of 8.3%, making the job switch premium the lowest since ADP began tracking the data Three years ago.

European

European stocks rose, as bets increased that global interest rate hikes had peaked, with the mining sector, a beneficiary of higher metal prices, leading the gains, while the German DAX index hit a new record high.

The European STOXX 600 index rose 0.1% in trading, while the German DAX index also rose 0.1%.

Shares of the British Ocado Group rose by 3.1% after G Bank raised… with me. Morgan gave his recommendation for the shares of the group specializing in the field of online grocery sales and technology from “relatively underweight” to “neutral.” On the other hand, the shares of the German company Merck fell 13.4% after its experimental drug evobrutinib to treat multiple sclerosis did not achieve the required goal in late-stage trials.

Japan

The Nikkei index recorded a sharp rise and erased losses suffered in the previous three sessions as investors bought back shares related to chips. The Nikkei jumped 2.04% to close at 33,445.90 points, recording the largest daily gain since November 15, and the broader Topix index rose 1.9% to 2,387.20 points.

Tokyo Electron, a manufacturer of chip manufacturing equipment, rose 2.2%, and Advantest, a manufacturer of chip testing equipment, rose 3%.

Sakura Internet shares jumped 12.09%, with Nvidia CEO Jin Sen Huang saying this week that the giant American semiconductor company will work with Japanese companies such as Sakura Internet to build artificial intelligence factories in Japan.