Global Factors influencing ASX stocks on 08 November 2023

On 08 November 2023, at AEDT 11:50 AM, the benchmark index S&P/ASX 200 is trading higher today, gaining 16.70 points or 0.24%, and is currently trading at 6,993.80 levels. Out of 11 sectors, 9 are trading higher along with the S&P/ASX 200. The Information Technology and Telecommunication Services sectors were the top 2 gaining sectors, up by 1.97% and 1.21% in their index values.

Also read: Mid-Market: S&P/ASX 200 Trading Higher By 0.26%; Buoyed By Tech Stocks

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 0.90%, 0.93%, 0.17%, and 0.28% respectively.

2. Crude prices plummeted to near seven-month lows at US$70 due to disappointing Chinese trade data, raising economic concerns for the world's largest crude importer. The US crude benchmark dropped 4% in November, following October's 11% loss, while Brent experienced a 3% drop this month on top of the previous 11% plunge. The market correction occurred as the war risk premium from the Israel-Hamas conflict unwound, despite OPEC+ heavyweights Saudi Arabia and Russia's supply cut pledges.

3. On Tuesday, U.S. stocks extended a seven-day winning streak, driven by strong performances in the technology sector, even as Treasury yields declined. Federal Reserve members hinted at potential rate hikes, but investors remained focused on their remarks. Fed governor Michelle Bowman reiterated the need for further rate increases to control inflation. Attention now turns to Fed Chair Jerome Powell's upcoming speeches, with futures markets anticipating unchanged rates at the December meeting.

4. According to a Reuters poll, the dollar's recent weakness is expected to continue for the rest of 2023. The majority of FX strategists believe that economic data will be the primary driver of major currencies in the coming year. The dollar has gained strength due to a stronger-than-expected U.S. economy and rising Treasury yields, as the Federal Reserve raised interest rates to tackle high inflation, giving it an edge over other currencies.

5. The Hang Seng and FTSE 100 is down by 1.65% and 0.10%.

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