Market update: Dow closes to a record high in thin trading; European markets down this morning – 12.11.2013

Source: Henderson Global Investors

The US government and bond markets were shut for Veterans Day holiday on Monday. On the stock markets trading volumes and volatility were low, however, stocks indices edged up. The Dow Jones managed to gain 0.1% to close at a record high of 15,783.10; the S&P 500 was up by a similar amount but the Nasdaq closed flat. A number of cyclical sectors including oil & gas, technology and financials managed to outperform.

Markets are broadly higher in Asia in overnight trading. Japan’s Nikkei 225 reaped the benefits of a weaker yen against the US dollar (up 2.2%), as the greenback continues its rally on rising expectations that the US Federal Reserve will soon reduce its stimulus. Chinese shares were mixed; while on the mainland the Shanghai Composite closed up 0.8%, Hong Kong moved in the opposite direction (Hang Seng down 0.7%). The gains were reported to be due to a positive sentiment surrounding the closing of China’s plenary meetings today where wide-ranging economic reforms are expected.

In European trading this morning, at the time of writing, both the FTSE Eurofirst 300 and FTSE 100 indices were down 0.5%. Investors are seemingly reluctant to build positions ahead of UK inflation data due today, while elsewhere in Europe corporate earnings were in focus.