Global equity markets have diverged this week as investors in the United States (US) have focused on the Republican’s tax bill making its way through the Senate, bringing cheer to investors who have led US equity markets to fresh record highs. This was despite North Korea firing a ballistic missile which it claimed put the entire of the US within range. Chinese equities started the week where they left off, falling further on concerns over a regulatory crackdown on leverage levels, with the Chinese CSI 300 index, which measures the top 300 stocks listed on the Shanghai and Shenzhen stock exchanges, down more than 5% since 22nd November.
Investor’s moods were lifted by the end of the week, after bumper earnings amongst technology names in the US (United States of America) yesterday.
In particular, results from “Super Thursday” were well received, where shares of Alphabet, Amazon, Intel and Microsoft all pushed higher. The dollar index, a measure of the dollar against a basket of peers, moved higher this week by 1.25%, and is trading at 94.87.
As of 12pm London time, the US S&P 500 is down 0.58%, the EuroStoxx 50 is up 1.53%, UK FTSE All Share is marginally lower returning -0.19%, whilst Emerging Markets fell 1.03%. The Japanese Topix had a strong week up 2.33 %.
The dollar climbed and Treasuries fell late in the week, as the United States (US) Senate passed through the initial federal budget blueprint. The latest decision has buoyed hopes on the prospects of US tax reform as the Republican party and President Trump intend to make significant tax cuts. Late on Thursday, the Republican controlled Senate, voted 51 to 49 in favour of the bill and the plan must now go through the House of Representatives in order to be passed. On the back of this news the dollar index, a measure of the US currency against a basket of major currencies, rose 0.2% to 93.458. As of 12pm the index is trading at 93.48. In markets, as of 12pm London time, the US S&P 500 is up 0.35%, the EuroStoxx 50 is up 0.22%, UK FTSE All Share is marginally lower returning -0.01%, whilst Emerging Markets fell 0.8%. The Japanese Topix had a strong week up 1.29%.