Asian markets experienced a mix of movements on Monday following a broad decline in stocks on Friday, as Wall Street wrapped up a shortened week on a negative note. U.S. futures were down, while oil prices remained steady. In South Korea, the Kospi index rose by 0.6% to 2,418.80, but Jeju Air Co. saw a decline of 8.8% after one of its planes skidded off a runway and tragically crashed, resulting in the loss of 179 lives. Meanwhile, political turmoil continued in South Korea as law enforcement officials sought a court warrant to detain impeached President Yoon Suk Yeol over allegations related to a martial law decree issued in early December.
The Nikkei 225 index in Tokyo dropped by 0.9% to 39,914.21 as the dollar strengthened against the Japanese yen. The Hang Seng index in Hong Kong decreased by 0.3% to 20,030.63, while the Shanghai Composite index rose by 0.3% to 3,408.72. Australia’s S&P/ASX 200 fell by 0.9% to 8,191.50.
On Friday, the S&P 500 declined by 1.1% to 5,970.84, with the majority of stocks in the index experiencing losses. Despite this, the index managed to hold onto a modest weekly gain of 0.7%. The Dow Jones Industrial Average and the Nasdaq composite also saw declines.
Market losses were exacerbated by significant drops in the shares of major tech companies, known as the “Magnificent 7”, which can heavily influence overall market trends due to their substantial market capitalization. Several retailers, including Amazon and Best Buy, also saw declines as investors closely monitored their performance during the holiday shopping season.
While Friday’s market performance was negative, the S&P 500 is on track to achieve a yearly gain of approximately 25% in 2024, marking a second consecutive year of strong growth. This positive trend has been supported by robust economic data indicating ongoing consumer spending and a resilient labor market, alongside a gradual easing of inflation pressures.
The Federal Reserve’s decision to reverse its interest rate policy this year, combined with expectations for further rate cuts, has contributed to market optimism. However, concerns persist around lingering inflation levels and uncertainties heading into 2025, including the potential impact of incoming President Donald Trump’s economic policies on inflation, government debt, and trade relations.
Challenges for global trade continue to persist. In other market movements early on Monday, the U.S. benchmark crude oil saw a marginal increase of 1 cent, reaching $70.61 per barrel. Meanwhile, Brent crude, the recognized international standard, experienced a slight decline of 1 cent, settling at $73.78 per barrel. Additionally, the euro weakened against the U.S. dollar, dropping from $1.0433 to $1.0427.
