Shares were mixed in Asia but fell in the US and Europe.
United States
US stocks fell on Monday, hurt by a steep drop in oil prices as well as a dip in Apple’s shares, pushing the S&P 500 back into negative territory for 2015. The Dow Jones Industrials were down 0.1%, the S&P fell 0.2% and the Nasdaq declined 0.1%. Six out of 10 S&P sectors declined. The S&P 500 energy sector lost 1.8% as investors sold shares in energy companies such as Exxon Mobil, Chevron and Chesapeake Energy. Crude oil prices fell sharply on Monday as investors turned their attention back to a global crude glut and renewed worries over demand.
Shares in Apple fell as investors worried that annual iPhone sales could decline for the first time in 2016. In the health care sector, Valeant Pharmaceuticals International fell after the Canadian drugmaker said that its CEO was going on medical leave. Shares in Chimerix plunged as the Phase 3 trial of a drug used to prevent infections following blood and marrow transplants did not meet its goals. Freeport-McMoRan fell as the natural resource company announced that its co-founder and long-time executive James Moffett will step down from the board and as Executive Chairman. Meanwhile, Walt Disney gained after the company’s latest Star Wars instalment topped $1 billion in ticket sales.
In a light day of economic reports, the Texas Manufacturing Outlook Survey showed that Texas factory activity increased for a third month in a row in December to 13.4. However, the index of future general business activity turned negative in December. According to MasterCard Advisors SpendingPulse, strong online sales and demand for furniture and women’s apparel helped US retail sales grow by a solid 7.9% this holiday season.
Europe
European equities finished lower in thin trade on Monday as oil prices fell. The Stoxx Europe 600 Index declined 0.5%. France’s CAC 40 closed nearly 1.0% lower, Germany’s DAX fell 0.7% and Spain’s IBEX 35 retreated 1.3%. The UK market was closed for a public holiday.
Shares in Repsol, Total, oil services company Technip and offshore drilling contractor Seadrill were among the decliners. Shares in ArcelorMittal also fell on profit taking, after gaining strongly in the previous week on a report saying that China was likely to cut its steel surplus that has kept prices at decade lows. Shares in Adidas fell after the company’s CFO told German newspaper Boersen-Zeitung that the sports retailer expected sourcing costs to rise next year because of negative currency effects.
However, shares in Italy’s third-largest bank Banca Monte dei Paschi di Siena rose after it reached a deal to sell a portfolio of non-performing loans worth 1 billion euros ($1.1 billion) to a Deutsche Bank vehicle. The news boosted shares in another Italian bank, Banca Pop Milano.
Asia Pacific
Performance in Asia Pacific markets was mixed on Monday amid a lack of immediate directional cues in light year-end trade. The Japanese market finished higher, with the Nikkei 225 Index gaining 0.6%, as weak domestic production and retail data strengthened the case for further policy stimulus. November’s factory output declined 1% month-on-month compared to the market expectation of a 0.6% drop. November retail sales also fell more than expected, by 1% year-on-year. Sharp’s shares surged on reports that Taiwan’s supplier of electronics products Hon Hai Precision Industry proposed to buy the struggling Japanese display maker for around 300 billion yen ($2.49 billion), provided its top management is revamped.
In China, the Shanghai Composite Index fell 2.6% as weak industrial profit data and a looming revamp of the country’s initial public offering (IPO) system gave investors little reason for optimism. Profits earned by Chinese industrial companies fell 1.4% in November from a year earlier, marking a sixth consecutive month of declines. Another source of concern has been the potential impact of imminent IPO reforms, which could see China moving from its current approval-based system toward a US style registration system, which could potentially boost share supply. Hong Kong’s Hang Seng Index also declined 1.0%. Shares in China Telecom fell as China’s anti-corruption watchdog said that the company’s chairman is being investigated for alleged violation of discipline.
In South Korea, the KOSPI Composite Index closed down 1.3%. Stocks affiliated with Samsung Group fell after the South Korean conglomerate said that its battery-making arm Samsung SDI will sell shares in sister firm Samsung C&T Corp to comply with regulatory requirements. On the other hand, India’s Sensex was up 0.8%. The Australia market was closed for Boxing Day.
Global Stock Markets

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*

The following indicators will be released this week…

 

Europe

 
 
 
 

December 29

Italy

Business Confidence (December)

 

Italy

Consumer Confidence (December)

December 30

UK

Nationwide Housing Prices (monthly and yearly) (December)

 

EU

Loan Growth (yearly) (November)

 
 
 

Asia/Pacific

 
 

December 31

Australia

Private Sector Credit (monthly) (November)

 

South Korea

Inflation Rate (monthly and yearly) (November)

January 1

South Korea

Balance of Trade (December)

 
 

Imports and Exports (yearly) (December)

 

China

NBS Manufacturing Purchasing Managers’ Index (December)

 
 

Non Manufacturing Purchasing Managers’ Index (December)

 
 
 
 
 

Americas

 
 

December 29

United States

S&P/Case-Shiller Home Price (monthly and yearly) (October)

 
 

CB Consumer Confidence (December)

December 30

United States

MBA Mortgage Applications

 
 

Pending Home Sales (monthly and yearly) (November)

December 31

United States

Continuing Jobless Claims

 
 

Initial Jobless Claims

 
 

Chicago Purchasing Managers’ Index (December)

*Note — all releases are listed in local time.