US ADP National Employment Report Showed an Increase of 235,000 jobs in December
Market Summary
Last week, investors focused on the recovery of employment in the United States. A significant shift in China's real estate policy and December's PMI data are also in the spotlight. The Shanghai Composite Index advanced 2.21% and the blue-chip CSI 300 gained 2.82%, marking its biggest gains in weeks.
In the United States, ADP December payroll report showed that jobs in the private sector increased by 235,000 in December, well above expectations for around 150,000, unemployment fell back to 3.5%. Both services and manufacturing activity fell, the Institute for Supply Management’s index of services sector activity fell to 49.6. In Europe, Shares surged, and the cost of natural gas also fell. Eurozone inflation slows below 10%, Eurozone PMI revised higher to 49.3 from a first estimate of 48.8. UK house prices fell for a fourth consecutive month in December, marking the largest quarterly drop since the global financial crisis.
In Asia, the Bank of Japan conducted unscheduled bond-buying operations to defend its new yield cap. Prime Minister Kishida urged Japanese companies to provide salary increases that are higher than inflation. Chinese government continued to focus on economic growth and was considering relaxing curbs on borrowing for the ailing property sector. The composite PMI data fell to 42.6 in December from 47.1 in November. China’s manufacturing, services, and property sectors weakened sharply in the fourth quarter of 2022.
Major News
The Kremlin has promised to cease hostilities from midday on Friday (6 January 2023) to midnight on Saturday (January 7, 2023) to mark Orthodox Christmas.
Jack Ma will give up control of Ant Group. A change in control means Ant has to wait longer before attempting a fresh listing in Hong Kong, or on the high-tech STAR board in Shanghai.
Although Eurozone inflation figures and US jobs data boosted hopes of a soft landing, economists warned underlying inflation would maintain pressure on central banks to raise interest rates
Kevin McCarthy was finally elected as Speaker of the House of Representatives on the 15th round of voting.
What Caught Our Attention
Elon Musk’s Starlink satellites have become an indispensable part of Ukraine’s warfare communication efforts against Russia.
This satellite system has been used by 150,000 people daily for vast communication purposes. One example includes the Ukraine soldiers sending photos of likely threats into a group chat, using the network that Starlink provides, where the higher ranking officials would decide whether to eliminate the targets. This proved to be a more efficient method as compared to usual means of communication.
The satellites’ portability and ease of connectivity makes it a perfect tool of communication for Ukraine, considering the damage that the Russian missiles have inflicted on its usual transmission routes.
Source: Kredens Capital, T. Rowe Price, Bloomberg, Financial Times, Wall Street Journal, The Economist, Nikkei Asia
