Daily market review

United States

Equities ended mixed as growth sectors rebounded on late bargain hunting after falling earlier on rising bond yields and concern over Federal Reserve tightening. The Dow Jones industrial average lost 0.5 percent, the S&P 500 declined 0.1 percent and the NASDAQ rose 0.1 percent.

Hard-hit growth stocks led the rebound, including the FANMAG complex, plus chipmakers and software. Nvidia, down in the morning, recovered to end up 0.6 percent, along with Microsoft, up 0.1 percent. Consumer discretionary recovered as Amazon ended down 0.7 percent, but well up from early lows, and Tesla, rebounded to end up 3.0 percent.

On the positive side, consumer staples got a lift from tobacco, with Philip Morris up 1.2 percent, and grocery stores, with Kroger up 2.0 percent. Vaccine makers Moderna, up 9.3 percent, and Novovax, up 6.5 percent, helped pharma.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil lost 99 cents to US$80.92 while spot gold rose US$6.12 to US$1,801.33. The US dollar was mixed vs. major currencies. Yields on the US Treasury 30-year bond fell 3 basis points to 2.09 percent, and the 10-year note was flat at 1.77 percent.


Equities fell as concern over rising inflation and higher interest rates continued, and as US markets dropped again in the US morning. The Europe-wide STOXX 600 fell 1.5 percent, the German DAX lost 1.1 percent, the French CAC fell 1.4 percent. The UK FTSE 100 was down 0.5 percent.

Highly-valued technology shares led the selloff, followed by industrials, construction & materials, media, personal & household goods, and financial services. Holding up best were banks, with support from higher bond yields, along with insurance, oil & gas, and travel & leisure.

UK stocks were mixed with major homebuilders off sharply after regulators ordered them to remove dangerous cladding from exteriors due to the fire hazard. On the positive side, the weak pound lifted exporters, including Unilever, up 0.8 percent, and British American Tobacco, up 1.8 percent.

Among companies in focus, Atos, the French technology consultant, dropped 17 percent after issuing a profit warning. On the positive side, TGS Nopec, the Swedish oil services company, jumped 12 percent after posting upbeat trading results.

Asia Pacific

Equities mostly improved with Hong Kong outperforming on strength in technology and biotech shares. Activity was limited by a holiday in Japan.

Chinese equities saw broad strength with China's CSI 300 index up 0.5 percent and the Shanghai composite up 0.4 percent. Supportive comments Friday from the head of the Chinese Securities Regulatory Commission continued to boost risk appetite though coronavirus concerns limited the gains. China imposed testing and new travel restrictions after finding Omicron cases in Tianjin, in addition to lockdowns in Shenzhen and elsewhere.

Hong Kong advanced with the Hang Seng index up 1.1 percent as investors bought the dip in beaten-down sectors including property, technology, and biotech.

South Korea's KOSPI fell 1.0 percent with risk appetite hurt by rising bond yields and coronavirus concerns. Taiwan Taiex rose 0.4 percent with another boost from strength in TSMC, which rose 1.4 percent after reporting record quarterly sales on strong demand from Apple and others.

Australian equities edged down with most sectors lower, and the All Ordinaries off 0.1 percent. Tech stocks tracked weakness on Wall Street but recovered from their morning lows. Consumer and health care stocks lagged while holding up better were energy, utilities, and materials.

Looking ahead*

In Asia/Pacific, the following are scheduled for release: Chinese new yuan loans, Australian goods & services trade, Australian retail sales, Chinese CPI. Ad Chinese PPI. In Europe, the Italian retail sales report is on tap. In North America, Fed Chair Jerome Powell will speak and the US NFIB business sentiment report is due.

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