Global stock markets displayed a mixed reaction on Monday following President Joe Biden’s surprising withdrawal from the 2024 presidential race, which has introduced additional uncertainties about the future of the world’s largest economy.
Biden’s announcement on Sunday, coupled with his endorsement of Vice President Kamala Harris as the Democratic candidate against former President Donald Trump, has yet to significantly impact financial markets, according to Stephen Innes of SPI Asset Management. “U.S. yields and the dollar opened slightly weaker in Asia but then rebounded, suggesting investors were fully clued into this outcome. The odds of a Trump victory also haven’t changed much,” Innes noted.
European markets showed early gains, with Germany’s DAX rising 0.8% to 18,311.32, and the CAC 40 in Paris gaining 0.8% to 7,596.64. In London, the FTSE 100 saw a 0.5% increase to 8,194.82. Futures for the S&P 500 were up 0.3%, while the Dow Jones Industrial Average edged 0.1% higher.
In Asia, however, the sentiment was less optimistic. Japan’s Nikkei 225 fell 1.2% to 39,599.00. The Hang Seng Index in Hong Kong gained 1.3% to 17,635.88, whereas the Shanghai Composite Index dropped 0.6% to 2,964.22. This decline followed China’s unexpected cut in its one-year benchmark loan prime rate (LPR) from 3.45% to 3.35% and a reduction in the five-year LPR from 3.95% to 3.85%. The People’s Bank of China implemented these measures to stimulate growth and address a persistent property slump. This move came after a report showing that the Chinese economy grew at a slower-than-expected rate of 4.7% annually in the second quarter.
Australian markets saw a slight dip, with the S&P/ASX 200 falling 0.5% to 7,931.70, while South Korea’s Kospi declined by 1.1% to 2,763.51.
On Friday, major U.S. indices experienced declines, with the S&P 500 dropping 0.7%, marking its first losing week in three and the worst since April. The Dow Jones Industrial Average fell 0.9%, and the Nasdaq composite lost 0.8%. These losses followed a massive technology outage that disrupted global flights, banking, and medical services. Cybersecurity firm CrowdStrike attributed the outage to a faulty update on Microsoft Windows, not a cyberattack, and has since deployed a fix. The incident led to a significant drop in CrowdStrike’s stock by 11.1%, while Microsoft’s shares fell by 0.8%.
In early Monday trading, U.S. benchmark crude oil remained steady at $78.64 per barrel, while Brent crude increased by 7 cents to $82.70 per barrel. The U.S. dollar weakened to 156.64 Japanese yen from 157.49 yen, and the euro rose slightly to $1.0892 from $1.0877.
Paraluman P. Funtanilla
Paraluman P. Funtanilla is Tutubi News Magazine's Marketing Specialist and is a Contributing Editor. She finished her degree in Communication Arts in De La Salle Lipa. She has worked as a Digital Marketer for start-up businesses and small business spaces for the past two years. She has earned certificates from Coursera on Brand Management: Aligning Business Brand and Behavior and Viral Marketing and How to Craft Contagious Content. She also worked with Asia Express Romania TV Show.
