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Global stock indices achieved strong gains in the first quarter, despite the fluctuations in indices and the consequences of raising interest rates. However, the banking crisis in America and Europe shifted investors’ attention again to technology stocks to lead the helm, after they fell to attractive prices under the blows of interest rates.
Global technology stocks rose 19% in the first quarter, as investors feel more confident despite the jitters in the US banking sector.
In the weekend, month and quarter session, Wall Street rose, with the Nasdaq index posting its biggest quarterly percentage gain since June 2020 after signs of subduing inflation raised hopes that the US Federal Reserve would soon end its aggressive campaign to raise interest rates. The S&P 500 posted gains for the second quarter in a row, led by the technology sector, which rose more than 20%.
On Friday, the Standard & Poor’s index closed at 4,109 points, up 1.43%, while the Nasdaq surpassed 12,221 points, with a daily gain of 1.74%. Likewise, the Dow Jones rose 408.66 points, or 1.24%, to 33,267.69 points.
The market got a boost on Friday after the Fed’s preferred inflation measure showed a smaller-than-expected rate increase. The core personal consumption expenditures index, which excludes energy and food costs, rose 0.3% in February, less than the 0.4% expected by economists in a Dow Jones poll.
fluctuations and stresses
Despite the fluctuations and continued tightening of fiscal policy, the Standard & Poor’s and Nasdaq indices rose by 7.03% and 16.77%, respectively, in the first quarter, which was the best performance from all quarters in 2021 and 2022, until mid-2020 for the technology-heavy Nasdaq. While the Dow Jones index rose by 0.38% during the first quarter.
As for the month, the Standard & Poor’s and Nasdaq indices rose by 3.51% and 6.69%, respectively. Meanwhile, the Dow Jones advanced 1.89% in March.
The journey up the indices was not smooth. Stocks rose in the latter part of March after the month began with the failure of two regional banks in America, the forced takeover of Credit Suisse and a flight of deposits from smaller institutions. Government support for SVB deposits, as well as Signature Bank, and the creation of a private lending facility for other banks helped halt the crisis.
Core credit lending totaled $88.2 billion, while banks took in $64.4 billion through the Fed’s New Bank Financing Program, according to Fed data released Thursday that covered the March 22-29 period. This total of $152.6 billion was down slightly from $164 billion in the previous week and another sign that the crisis was settling towards the end of the month.
European stocks
For its part, European stocks rose, in the weekend, month and quarter session, Friday, as fears of a comprehensive banking crisis continued to recede and in light of the strengthening of sentiment thanks to a record monthly decline in inflation figures in the euro zone and the decline in the preferred inflation measure of the US Federal Reserve.
The pan-European STOXX 600 recorded gains for the second quarter in a row, but ended the month of March slightly lower after several eventful weeks following bank failures.
European stock markets closed 7.05% higher in the first quarter despite a volatile few weeks of trading in the banking sector.
The European index closed down -1.36% for the month of March.
In terms of market indices, the British FTSE 100 gained 2.4% in the first quarter, despite its decline by 3.11% in March, while the quarterly gains of the German DAX index reached 12.25%, after it succeeded in converting its losses into gains in March, as it rose by the end of the month. 1.7%. In France, the quarterly gains of the “CAC 40” index amounted to 13.11%, after achieving a monthly gain of 0.75%.
On Friday, the Stoxx 600 closed 0.6% higher than the previous session after consumer price hikes in the Eurozone subsided and the headline inflation reading in the US came in lower than expected.
Japan shares
In Tokyo, the Japanese Nikkei index rose, on Friday, in the last trading days of the country’s fiscal year, and recorded its best week in two months, after the easing of fears of a banking crisis and the decline of the yen boosted investor sentiment.
The Nikkei ended the day, up 0.93%, at 28,041.48 points, to remain above the 28,000-point barrier. It had reached 28124.62 in early trading, up 1.23% and 342 points from the previous close.
The Nikkei rose 2.4% over the week, its biggest rise since January 27. It jumped 7.46% during the last fiscal quarter, marking the best performance since the end of 2020.
The broader Topix index closed 1.02% higher, on Friday, at 2003.50 points, after crossing the 2,000-point barrier for the first time since March 13. It rose 2.46% this week, its largest rise in two months.
(agencies)
