Global Factors influencing ASX stocks on 08 December 2023

On 08 December 2023, at AEDT 12:35 PM, the benchmark index S&P/ASX 200 is trading lower today, declining 27.80 points or 0.39%, and is currently trading at 7,145.50 levels. All 11 sectors are trading lower along with the S&P/ASX 200. The A-REIT and Telecommunication Services sectors were the top 2 declining sectors, down by 1.06% and 0.73% in their index values.

Also read: Mid-Market: S&P/ASX 200 Trading Lower By 0.29%; Dragged Down By IT And A-REIT Sectors

On that note, let us look at a few global reasons impacting the stock market today:

1. Some of the key U.S. indices ended higher in their previous session. NASDAQ Composite, NASDAQ-100, Dow jones, and S&P 500 ended higher by 1.37%, 1.48%, 0.17%, and 0.80% respectively.

2. On Thursday, the Dow closed slightly higher, driven by a tech-led rally supported by Alphabet and AMD, although losses in energy stocks tempered the gains ahead of the upcoming monthly jobs report on Friday. Alphabet Inc Class A (NASDAQ: GOOGL) saw a notable increase of over 5% after unveiling its latest AI model, Gemini. This new multi-model AI system, with capabilities in understanding audio, photos, and video, signals Alphabet's intent to compete with rivals like OpenAI, Microsoft, and Meta.

The broader tech sector, buoyed by chip stocks, recorded a nearly 3% gain, largely propelled by a surge in Advanced Micro Devices. The dynamic performance of tech giants and the advancements in AI underscore the competitive landscape and innovation within the industry.

3. Santos Ltd shares surged nearly 11% to a five-week high after confirming talks with Woodside Energy for a potential AU$80 billion (US$52 billion) merger. The proposed consolidation aims to create a major oil and gas entity with diverse global assets, spanning Australia, Alaska, the Gulf of Mexico, Papua New Guinea, Senegal, and Trinidad and Tobago. The market responded positively, reflecting investor optimism about the potential synergy between these energy industry giants.

4. In November, a U.S. market rally across equities and bonds contributed to the hedge fund industry's best monthly performance since January, according to Hedge Fund Research (HFR). Despite causing losses to bearish macro strategies, overall, the hedge fund industry posted gains of 2.2% in November and is up 4.35% for the year. The positive performance was attributed to economic data indicating a decline in inflation, resulting in falling bond yields, and buoyant equity and cryptocurrency markets. Investors positioned themselves for the conclusion of the Federal Reserve's interest rate increasing cycle.

5. The Hang Seng and FTSE 100 is down by 0.71% and 0.02%.

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