By CHRIS ILLING
CCO at ActivTrades Corp
The first trading week of 2023 is behind us after providing some hope on the global stock markets.
A robust labour market report from the US, and slightly weaker than expected inflation in the euro zone, gave the German Dax a boost on Friday. The leading German index was again very friendly in the late afternoon at 1.2 percent and, at times, climbed above the 14,600 point mark. It gained more than 4 percent last week.
In addition, inflation in the euro region weakened more than expected in December. Consumer prices rose compared to December 2021, but less significantly than in November, and by less than expected among economists.
The US economy created more jobs than expected in December. Outside of agriculture, 223,000 jobs were added, the Department of Labor announced on Friday. On average, analysts had only expected 203,000 new jobs. However, the increase in employment in the two previous months was revised downwards by a total of 28,000 jobs. The separate unemployment rate surprisingly fell to 3.5 percent from 3.6 percent in November. At the same time, wages rose less than expected, which brought relief when it came to the possible further stoking of inflation.
Current US job data reassured investors on Friday. The New York indices, which had started the New Year relatively weak so far, are clearly in the black after initial fluctuations in the course of the publication. The Dow Jones Industrial Average rose by 2.1 percent to 33,640 points. Meanwhile, the tech-heavy Nasdaq 100 gained 2.7 percent to 10,585 points.
Asian stocks gained on Friday as the dollar lingered at a monthly high. The 225 Nikkei Index closed 0.6 percent higher at 25,975 points. The Shanghai stock exchange was up 0.4 percent. The index of the most important companies in Shanghai and Shenzhen gained 0.6 percent.
The crypto currency, Bitcoin, continues to hover around the $17,000 mark. Bitcoin hit a record high of $69,000 in November 2021.
Oil prices rose on Friday. A barrel of North Sea Brent cost $79.83 in the late afternoon. That was $1.12 more than the day before. The price of a barrel for the American West Texas Intermediate (WTI) grade rose by $1.19 to $74.85. Oil prices have thus recovered somewhat from the significant losses of the first trading days of the new year.
Oil prices were somewhat supported by the weaker dollar exchange rate. Crude oil is traded in dollars. A weaker dollar makes crude oil cheaper for investors from other currency areas.
Overall, however, oil prices have eased in the first week of the New Year. Weak economic data from China weighed on oil prices as it fuelled concerns about slowing demand in the world’s second largest economy. Market observers also pointed to price reductions for crude oil, which Saudi Arabia will deliver to Asia and Europe in February.
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