Global Stock Market: Markets Upbeat Despite Mixed Signals on Stimulus Package

Global COVID-19 cases remained on the rise this week at 36.4 million, an increase of 7.4% from last week while the death toll rose 4.3% to 1.0 million. The US remains the major epicentre of the pandemic with 7.9m reported cases, which has slowed the reopening of economic activities. Consequently, unemployment claims remained sticky around 800,000 people since the beginning of September amid huge furloughs in the airline industry. Another round of stimulus could help, however mixed signals abound as the House Speaker, Nancy Pelosi and Treasury Secretary, Steven Mnuchin indicated talks on a comprehensive bill while President Donald Trump requested a hold in negotiations till after the November elections. 

Performance in the developed markets was impressive with all indices advancing w/w. In the US, the S&P 500 and NASDAQ indices rose 3.3% and 4.0% w/w respectively. In the UK, the FTSE All-Share index inched higher by 2.3% w/w despite less-than-expected economic growth in August and surging COVID-19 numbers. Similarly, France’s CAC 40 gained 2.3% w/w and Germany’s XETRA DAX index advanced 2.6% w/w following positive earnings forecasts. Hong Kong’s Hang Seng index rose 2.8% w/w while Japan’s Nikkei 225 index closed the week higher by 2.6% w/w.

Performance across the BRICS markets mirrored that of the developed markets with all indices advancing w/w. India’s BSE Sens gained the most, up 4.7% w/w as the monetary authority maintained an accommodative monetary policy. Similarly, Brazil’s Ibovespa and China’s Shanghai Composite indices inched higher by 3.6% and 1.7% w/w respectively. South Africa’s FTSE/JSE All-Share and Russia RTS indices also appreciated 1.6% and 1.5% w/w respectively.

In Africa, performance was mixed but positively skewed with 4 of 6 indices under our coverage advancing w/w. Nigeria's All-Share and Egypt’s EGX 30 indices led the gainers, up 5.3% and 3.1% w/w respectively. Morrocco’s Casablanca MASI and Ghana’s GSE Composite indices also gained, advancing 1.1% and 1.0% w/w respectively. Conversely, Kenya’s NSE 20 and Mauritius’ SEMDEX indices lost, down 0.8% and 0.6% w/w respectively.

Across the Asian and Middle East markets, performance was bullish as oil prices appreciated due to OPEC’s optimism on oil demand outlook. Thailand's Set and Turkey’s BIST 100 indices gained the most, up 2.4% and 1.5% w/w respectively. Saudi Arabia’s Tadawul All Share and UAE’s ADX General indices also rose 1.4% and 0.5% w/w respectively. Lastly, Qatar’s DSM 220 index gained 0.3% w/w.