Dec 18, 2023: As the penultimate week of 2023 commences, European markets opened with a subdued tone. The pan-European Stoxx 600 hovered around the neutral mark during early afternoon trading. Notably, oil and gas stocks saw a 1.1% increase as oil prices rose due to concerns arising from the Red Sea. Conversely, construction and material stocks experienced a decline of 1.2%.
Closing last week on a high note, the continental blue-chip index marked its fifth consecutive week of gains, culminating with a 0.91% rise on Friday. This surge came in the wake of significant central bank decisions made throughout the week.
The global markets were largely influenced by the U.S. Federal Reserve’s announcement, which outlined plans for three interest rate cuts across 2024.
In the U.S., stocks initially displayed a slight uptick after the three major Wall Street indices secured their seventh consecutive week of gains.
Across Asia-Pacific markets, Monday witnessed a predominantly lower trend, except for South Korean markets, which saw an uptick driven by gains in defense stocks.
Within Europe, attention is turned toward speeches scheduled for Monday afternoon by two key European Central Bank voting members—Isabel Schnabel and Philip Lane.
The ECB, in its last week’s meeting, maintained rates while revising down growth and inflation forecasts. Additionally, the bank outlined plans to expedite the reduction of its balance sheet. ECB President Christine Lagarde also countered market expectations, expressing resistance toward substantial rate cuts in 2024.