The markets are in a celebratory mood with positive news at the end of the Christmas season as traders are back from their breaks. The US and China are nearing the signing of the initial phase of a new trade deal, marking a significant step towards ending the trade war.
Asia and Europe are buzzing with optimism following this development. European stock indexes are on the rise, with Japan’s Nikkei showing a 0.4% increase and heading towards a 19% growth for 2019, reminiscent of its successful performance in 2017.
China also brings positive tidings as industrial profits saw the quickest growth in eight months in November. Although there are concerns about weakened domestic demand affecting company earnings in the short term, the manufacturing sector has reaped the benefits of government stimulus and reduced trade tensions. Industrial profits surged to 5.4% in November, breaking a streak of three months of decline. Production sales have picked up pace, signaling an end to a months-long downturn that saw a 9.9% decrease in October. Analysts predict that the easing trade war will drive a surge in corporate investment in the coming months.
This year’s holiday season global rally is a stark contrast to the market turbulence witnessed last year due to escalating trade tensions. Global oil and gold prices are holding steady with recent gains, buoyed by robust US employment figures and a strengthening global economy. As we enter 2020, the outlook appears promising for a positive start.
