Global Factors influencing ASX stocks on 21 December 2023

On 21 December 2023, at AEDT 11:55 AM, the benchmark index S&P/ASX 200 is trading lower today, declining 23.40 points or 0.31%, and is currently trading at 7,514.50 levels. Out of 11 sectors, 8 are trading lower along with the S&P/ASX 200. The Consumer Discretionary and Materials sectors were the top 2 declining sectors, down by 0.43% and 0.42% in their index values.

Also read: Mid-Market: S&P/ASX 200 Trading Lower By 0.08%; Tracking US Markets Losses

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 lower in their previous session. NASDAQ Composite, Dow jones, NASDAQ-100, and S&P 500 ended lower by 1.50%, 1.27%, 1.53%, and 1.47% respectively.

2. On Wednesday, the Dow closed lower, ending a nine-day winning streak, as investors engaged in profit-taking amidst the weeks-long rally that had propelled stocks to all-time highs. The S&P 500, nearing its own all-time high, also experienced a reversal, leading to the broadest market selloff since March. Earlier in the day, stocks had shown positive momentum, influenced by indications of consumer strength and increased housing activity.

3. Oil prices settled higher on Wednesday, although their upward momentum faced headwinds due to an unexpected jump in U.S. crude supplies. This development raised fresh concerns about the possibility of global output outpacing demand. In the week ending December 8, U.S. crude inventories unexpectedly surged by approximately 2.9 million barrels, contrary to expectations of a draw of only 2.3 million barrels. Gasoline inventories, a product refined from crude, saw an increase of around 2.7 million barrels, surpassing the anticipated build of 1.2 million barrels. Furthermore, distillate stockpiles rose by 1.5 million barrels, exceeding expectations for a 496,000-barrel increase.

4. Warner Bros. Discovery witnessed a more than 5.7% decline in its shares on Wednesday following reports from Axios about early-stage discussions with Paramount Global regarding a potential merger. According to sources, the two CEOs met in New York City. In response to this news, Paramount shares closed 2% lower. If realized, the merger could form a significant entity in the news and entertainment sector, potentially triggering further consolidation within the industry.

5. The Hang Seng and FTSE 100 is up by 0.66% and 1.02%.

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