Stock indices rise on weak US labor market report. In Switzerland, there is a further decline in inflation

On Friday, the Dow Jones (US30) rose 0.69% (for the week -0.50%). The S&P 500 Index (US500) gained 0.41% (for the week -1.80%). The NASDAQ Technology Index (US100) closed positive 0.72% (for the week -2.06%). Stocks in the US closed sharply higher on Friday, starting November with gains as strong earnings from Amazon (AMZN) and Intel (INTC) bolstered market sentiment, allowing traders to skip a disappointing jobs report. The US jobs report showed that only 12,000 jobs were created in October, well below expectations. Analysts attributed the weak data to the devastating effects of the hurricane and the Boeing strike.

On Wall Street, there is still near-unanimous expectation that the Federal Reserve will cut its key interest rate by a quarter percentage point on Thursday this week.

Nvidia (NVDA) will replace Intel (INTC) in the Dow Jones Industrial Average rankings, ending the semiconductor pioneer’s 25-year history of falling behind rivals. S&P Dow Jones Indices said Friday that the changes, effective November 7, were initiated to provide more representative exposure to the semiconductor and materials sectors, respectively. Intel’s share price has fallen more than 50% this year. Nvidia shares, in contrast, are up more than 173% this year.

Equity markets in Europe rose steadily on Friday. Germany’s DAX (DE40) gained 0.93% (for the week -1.40%), France’s CAC 40 (FR40) closed up 0.80% (for the week -1.76%), Spain’s IBEX 35 (ES35) gained 1.46% (for the week -0.23%), and the UK’s FTSE 100 (UK100) closed up 0.83% (for the week -0.87%).

Switzerland’s annual inflation rate fell to 0.6% in October 2024, the lowest since June 2021, down from 0.8% in September and below estimates of 0.8%. Markets currently give a 72% probability that the Central Bank will cut rates from 1% at its next meeting on December 12 to 0.75% and a 68% probability that it will cut again next March to 0.5%.

WTI crude oil prices rose to $71 a barrel on Monday, extending gains for a fourth straight session as OPEC+ decided to postpone December production plans for a second time. The decision is aimed at stabilizing prices amid ongoing economic concerns and averting a potential oversupply in the market, given uncertainty over demand growth.

Asian markets were mostly down last week. Japan’s Nikkei 225 (JP225) gained 0.78%, China’s FTSE China A50 (CHA50) fell by 1.54%, Hong Kong’s Hang Seng (HK50) lost 0.42%, and Australia’s ASX 200 (AU200) was negative 1.13%.

Beijing’s latest stimulus measures have started to have a positive impact ahead of next week’s session of the National People’s Congress, where new initiatives may be unveiled. Chinese authorities are expected to provide more details on debt and fiscal initiatives aimed at reviving economic growth. They are likely to consider a stimulus package in excess of ¥10 trillion to revitalize the economy.

Japan’s opposition party chief Yuichiro Tamaki, whom the ruling LDP is seeking support from after losing its majority in the lower house of parliament, said the Bank of Japan should wait at least six months before raising interest rates. Kiuchi believes the ruling party will have to accept the opposition party’s position that ultra-soft monetary policy should be maintained until wage growth is consistently above inflation.