European stock markets are expected to open slightly lower as the year-end trading session approaches, with low volumes anticipated due to early market closures for New Year’s Eve. Key indices, including France’s CAC 40 and the UK’s FTSE 100, are projected to decline. Meanwhile, global markets remain cautious, with manufacturing data awaited later in the week. In the U.S., stocks fell amid rising Treasury yields, while Asian markets showed mixed results as they close for the holidays.
European Stock Markets Anticipate Slight Decline
PARIS (Reuters) – As the final trading session of the year approaches, European stock markets are projected to open on a slightly lower note this Tuesday. With many markets closing and others operating on shortened hours for New Year’s Eve, low trading volumes are expected, leaving investors with few catalysts to drive activity.
Early indications suggest that the CAC 40 in Paris could see a decrease of 0.09% at the start. Similarly, the FTSE 100 in London is forecasted to drop by 0.25%. The EuroStoxx 50 index may decline by 0.67%, while the Stoxx 600 is expected to fall by 0.55%.
Notably, stock exchanges in Italy, Switzerland, and Belgium will be closed for the day.
Given the upcoming New Year’s holiday, investors are likely to remain cautious and avoid risky assets. Most European stock exchanges will be closing early at 1:00 PM GMT. Additionally, markets in Euronext, London, and Wall Street will be shut down on Wednesday for New Year’s Day.
Global Market Overview
The economic calendar for major markets worldwide appears sparse this Tuesday, with key manufacturing activity indicators not set to be released until Thursday and Friday in both Europe and the United States.
In China, the latest official survey indicates that manufacturing activity expanded for the third consecutive month in December, although the pace of growth has slowed.
On Wall Street, the New York Stock Exchange concluded Monday’s session lower amidst lackluster performance, primarily influenced by rising U.S. Treasury yields. The Dow Jones index fell by 0.97%, dropping 418.48 points to settle at 42,573.73 points. The broader S&P 500 lost 1.07%, down 63.90 points to 5,906.94 points, while the Nasdaq Composite decreased by 1.19%, losing 235.25 points to end at 19,486.785 points.
In Asia, the Tokyo Stock Exchange closed down on Monday due to profit-taking but remains closed on Tuesday after a substantial annual gain of nearly 20% for the Nikkei index. Markets in Japan will reopen on January 6, 2025. Meanwhile, the MSCI index tracking Asia and Pacific stocks (excluding Japan) has dipped by 0.2% but is on track for an 8% annual gain, marking its second consecutive year of growth.
In China, the Shanghai SSE Composite fell by 1.63%, and the CSI 300 dropped by 1.60%, despite positive signs in manufacturing activity suggesting that government stimulus measures are starting to take effect. Chinese markets have achieved their first annual gain in three years after previous losses linked to the COVID-19 pandemic, surprising many investors with their resilience.
Overall, as 2024 comes to a close, the financial landscape reveals cautious optimism amidst ongoing challenges, with investors carefully monitoring economic indicators and market conditions.