Daily market review

United States

Strength in megacaps and other growth stocks led equities higher Monday. The Dow Jones industrial average rose 0.3 percent, the S&P 500 gained 0.8 percent and the NASDAQ advance 1.9 percent.

A huge rally in Twitter, up 27 percent, lifted communications services and growth stocks after news that Elon Musk had taken a 9.2 percent passive stake in the social media firm. Facebook/Meta gained 4.0 percent and Google advanced 2.1 percent.

Growth stocks were bolstered by a rally in Chinese technology shares on reports that US and Chinese regulators may resolve a spat soon over US audit requirements that threatened delisting of Chinese firms. Among Chinese firms listed in the US, JD.com rose 6.7 percent, Alibaba rose 6.5 percent and Pinduoduo gained 15 percent.

US megacaps appeared to benefit from uncertain global growth prospects, including fear that rising energy prices and Federal Reserve tightening will tip the economy into recession.

Among the day's winners, Apple was up 2.4 percent and Microsoft gained 1.8 percent. Tesla gained 5.6 percent after topping analyst forecasts for auto deliveries in the first quarter, despite Covid lockdowns in China.

Lagging were financials, health care, and defensive plays.

Among other stocks in focus, Starbucks lost 3.7 percent after the company said it would suspend its dividend. Among pharma stocks, Alnylam fell 4.4 percent after the Food & Drug Administration extended the review period for its amyloidosis medication.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil rose US$3.35 to US$107.93 while spot gold rose US$9.16 to US$1,932.74. The US dollar was mixed vs. major currencies. The US Treasury 30-year bond yield rose 4 basis points to 2.46 percent and the 10-year note yield rose 3 basis points to 2.40 percent.


Equities got a boost from a positive start on Wall Street and positive company news. The Europe-wide STOXX 600 rose 0.8 percent, the German DAX gained 0.5 percent, the French CAC rose 0.7 percent and the UK FTSE 100 was up 0.3 percent.

Among sectors, best were travel & leisure, technology, health care, and media. Lagging were insurance, basic resources, oil & gas, and basic resources.

Among pharma stocks, Novartis rose 1.4 percent on restructuring plans, Bayer rose 3.3 percent after positive clinical test news and Roche gained 3.1 percent on positive news for its Covid medicine. Among other winners, Ryanair gained 1.5 percent on positive traffic figures. Ted Baker, the clothing retailer, rose 14 percent after a series of bids to buy the company from private equity.

Asia Pacific

Asia-Pacific equities improved Monday with large-cap growth stocks leading in Hong Kong.

Hong Kong rallied on hopes for Chinese concessions in the dispute with US regulators over US audit requirements for US-listed Chinese firms. Mainland markets and Taiwan were on holiday. The Hang Seng index advanced 2.1 percent with big growth stocks leading, including Baidu, up 7.8 percent and Alibaba, up 3.7 percent.

US market strength and capital inflows on the first day of the new fiscal year bolstered Japanese equities. Japan's Nikkei 225 firmed 0.3 percent and the wider TOPIX gained 0.5 percent. Best sectors included marine transportation, pharma, mining, and banks.

The South Korean KOSPI rose 0.7 percent. The Indian BSE Sensex rose 2.3 percent.

Australian equities edged up with utilities, miners, and. tech leading the winners while banks and consumer discretionary stocks lagged. The All Ordinaries index rose 0.4 percent.

Looking ahead*

In Asia/Pacific, South Korean CPI, Japanese household spending, Japanese PMI composite, and Singapore PMI figures are scheduled, plus the Reserve Bank of Australia policy announcement. In Europe, reports on French industrial production, French PMI composite, German PMI composite, Eurozone PMI composite, and UK PMI composite are due. In North America, Canadian merchandise trade, US international trade in goods & services, US PMI composite final, and US ISM services reports are on tap.

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