Most global stock indices paused for breath Friday but were still higher for the week.
United States
US stocks barely edged higher Friday with the Dow Jones industrials and S&P turning positive in the last minutes of the trading day. Gains in Kraft Heinz helped offset selling in energy stocks. The Dow was virtually unchanged (up 4.01 points), the S&P was up 0.2 percent and the Nasdaq was 0.4 percent higher. On the week, the indices were up 1.7 percent, 1.5 percent and 1.8 percent respectively. Profit taking contributed to Friday’s initial weakness. With a strong fourth quarter earnings season mostly complete, many investors now say they need concrete signs of progress from the Trump administration on his policy plans.
Unilever’s U.S.-listed shares surged. UnitedHealth sank after it was sued by the US Justice Department over Medicare charges. TrueCar advanced after the car buying website operator reported a narrower than expected fourth quarter loss and provided upbeat guidance. Nu Skin was lower after the company reported weaker than expected fourth quarter results and offered disappointing guidance. Exxon Mobil and Chevron declined.
Kraft Heinz jumped Friday after it said it would continue to pursue a $143 billion bid for Unilever, despite being rebuffed. On Sunday afternoon US ET, both companies said the proposed merger was off. In a joint release they said: “Unilever and Kraft Heinz hereby announce that Kraft Heinz has amicably agreed to withdraw its proposal for a combination of the two companies. Unilever and Kraft Heinz hold each other in high regard. Kraft Heinz has the utmost respect for the culture, strategy and leadership of Unilever.”
The Conference Board’s leading economic index climbed 0.6 percent in January after rising by 0.5 percent in December.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$1.40 to US$1,241.95. Copper futures were down 0.6 percent to US$2.72. WTI spot crude was up 4 US cents to US$53.40. Dated Brent spot crude was up 16 US cents to US$55.81. The US dollar was up against the all of its major counterparts including the euro, pound, Swiss franc and the Canadian and Australian dollars. The currency declined against the yen. The Dollar Index was up 0.4 percent. The yield on US Treasury 30 year bond was down 3 basis points to 3.02 percent while the yield on the 10 year note was down 4 basis points to 2.41 percent.
Europe
Most European stock indices retreated Friday for a second day. However, both the FTSE and SMI advanced 0.3 percent and 0.5 percent respectively. The CAC lost 0.7 percent while the DAX was virtually unchanged (down 0.22 point). Investors were disappointed by the unexpected drop in UK retail sales and the drop in the euro area current account surplus. Bank stocks were among the weakest performers at the end of the trading week while a drop in iron ore prices weighed on the mining sector. For the week, all the indices advanced. The FTSE and SMI were both up 0.6 percent while both the CAC and DAX added 0.8 percent.
Allianz climbed after the insurer announced a share buyback program worth up to €3 billion after posting solid fourth quarter results. Drug-maker Stada Arzneimittel gained after saying the ‘open-minded’ talks with the two potential bidders are continuing. Both Deutsche Bank and Commerzbank were down. Société Générale, BNP Paribas and Crédit Agricole also finished lower. Essilor International was lower after the eye-care firm lifted it dividend after reporting an increase in fiscal 2016 profit.
Unilever jumped after Kraft Heinz offered to acquire the company. Unilever rejected the takeover proposal. AstraZeneca advanced after the drug-maker reported positive results from its Phase III OLYMPIAD trial of its breast cancer treatment. Coca-Cola HBC extended Thursday’s rally after the bottling firm said it expects slightly better economic conditions to support volume growth in 2017. Anglo American, BHP Billiton, Glencore and Royal Dutch Shell declined.
The euro area current account surplus declined in December to a seasonally adjusted €31 billion in December from €36.4 billion in November. UK retail sales including automotive fuel dropped a monthly 0.3 percent in January after declining 2.1 percent in December.
Asia Pacific
Stocks ended the week on a down note. Investors were concerned over growing US crude production and the strengthening yen and opted to stay on the sidelines ahead of the weekend.
The Shanghai Composite dropped 0.9 percent as investors locked in some of the recent gains. The Hang Seng was down 0.3 percent on uncertainties over US fiscal and monetary policies.
The Nikkei and Topix were down 0.6 percent and 0.4 percent respectively. Exporters fell broadly, with Panasonic, Hitachi, Toyota and Suzuki Motor declining. Oil explorer Inpex retreated along with property developer Mitsui Fudosan. Toshiba tumbled after rating agency S&P Global warned of another downgrade. Banks including Mitsubishi UFJ Financial, Mizuho Financial and Sumitomo Mitsui Financial were lower after US bond yields eased overnight in the wake of dovish comments from New York Fed President William Dudley.
Both the S&P/ASX and All Ordinaries were down 0.2 percent Friday in choppy trading. Gains among banks were offset by weakness in the mining sector. Lower copper and iron ore prices weighed on the mining sector, with BHP Billiton, Rio Tinto and Fortescue Metals Group declining. Whitehaven Coal was lower after the company said it would use the extra cash flow from the recent jump in coal prices to speed up its debt payments. Health insurer Medibank Private and airline Virgin Australia Holdings declined after unveiling their first-half results. The S&P/ASX was up 1.5 percent and the All Ordinaries added 1.4 percent on the week.
The Kospi slipped 0.1 percent after Samsung Group’s Lee Jae-yong was formally arrested over his alleged role in a corruption scandal that led to the impeachment of South Korean President Park Geun-hye. However, on the week, the index added 0.3 percent. The Sensex added 0.6 percent Friday and was up 0.5 percent for the week.
Looking Forward

The following indicators will be released this week…

Europe

Feb 20

Eurozone

EC Consumer Confidence (February flash)

Feb 21

Eurozone

Manufacturing PMI (February flash)

Composite & Services PMI (February flash)

Germany

Manufacturing PMI (February flash)

Composite & Services PMI (February flash)

France

Manufacturing PMI (February flash)

Composite & Services PMI (February flash)

Feb 22

Eurozone

Harmonized Index of Consumer Prices (January final)

Germany

Ifo Business Survey (February)

UK

Gross Domestic Product (Q4.2016 second estimate)

Feb 23

Germany

Gross Domestic Product (Q4.2016 final)

Asia Pacific

Feb 20

Japan

Merchandise Trade Balance (January)

Feb 21

Japan

Manufacturing PMI (February flash)

Americas

Feb 21

United States

Manufacturing PMI (February flash)

Feb 22

Canada

Retail Sales (December)

United States

Existing Home Sales (January)

Feb 23

United States

Initial Unemployment Claims (week ending prior Saturday)

Feb 24

Canada

Consumer Price Index (January)

United States

Consumer Sentiment (February final)

New Home Sales (January)

Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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