European stocks advanced, trimming their first December decline since 2008 amid low equity volume.
Trading on the London Stock Exchange will end at 12:30 p.m. local time today, and NYSE Euronext’s European cash markets will close 35 minutes later. The Madrid bourse will stop trading at 2 p.m. local time. Exchanges in Germany, Switzerland, Italy and the Nordic countries are closed.
The volume of the session should be reduced, and may focus on the final stage of negotiation with institutional investors to adjust their portfolios to the beginning of the year which is foreseen to be turbulent. In fact, the beginning of 2015 should be marked by political uncertainty in Greece, the economic and financial situation in Russia and the continuous oil price weakness. Fund managers also need to consider the amount of redemptions and subscriptions in recent weeks, which will influence the decrease or increase the exposure of these funds to equity markets. At the end of the session may occur some selling pressure related to tax issues. The idea behind tax-related selling is that individuals who have experienced capital gains in a calendar year can offset the taxes paid on those gains by showing losses on other investments. For that reason, in a year where many thing have performed well, badly performing assets can add to selling pressure.
US markets fell slightly after the S&P and Dow Jones have reached another record high on Monday. Yesterday´s session accused the lack of liquidity typical of this season, and the volume was the lowest in the past few months. The weakness of European markets and the initial retreat of oil led some investors to realize capital gains. Economic data ended up not having a significant impact on the course of the session. Property prices in 20 major US metropolitan areas, as measured by the S&P / Shiller index rose 0.76% in October compared to September, against expectations for a 0.40% increase. In annual terms, ie, from October 2013, house prices rose 4.50%, the lowest increase in the last two years.
Consumer confidence, as measured by the Conference Board, rose in December to 92.1 compared to 91.0 in November. Although this reading fell short of the estimated (94.0), there was an improvement in the perception of consumers in relation to the labor market, which continues to be their main source of income.
The US stock market is open for trading today from 14h30 to 21h00.
With the exception of Hong Kong stock market, Asian markets closed down, before disappointing data given by the Chinese economy. To notice that the Tokyo Stock Exchange was closed.
According to HSBC economists, the PMI index on manufacturing activity, fell in December from 50.0 to 49.6. While this reading is marginally better than the preliminary reading of December (49.5), the situation of the Chinese economy continues to provoke concern among investors and will be a central theme of 2015. Recently, the Bank of China reduced its estimates for GDP growth in 2015 from 7:40 to 7:10%%.