Global Markets: Stocks end 2022 with a thud; Treasury yields, oil prices rise

USU Ventures AG

30/12/2022 22:14

(Updates prices, adds commentary,)

        * 
      MSCI global stock index down 20% on the year
    

        * 
      Indexes YTD drop: Dow 8.7%, S&P down 19.4%, Nasdaq 33% 
    

        * 
      Dollar eyeing biggest annual gain in seven years
    

  
    By Sinéad Carew and Carolyn Cohn
       NEW YORK, LONDON Dec 30 (Reuters) - Wall Street equity
indexes finished lower on Friday on 2022's last trading day,
while Treasury yields rose along with oil futures as investors
braced for the new year with worries about a potential recession
and the U.S. Federal Reserve rate hiking path. 
    In currencies, the dollar, a beneficiary of rising U.S.
interest rates, fell on the day but was on track for a 2022 gain
of roughly 8%, its biggest annual increase since 2015. 
    The U.S. U.S. 10-year Treasury yield rose on Friday and
closed out the trading year with its biggest annual increase in
decades, pushed higher by aggressive Fed rate hikes.
    The Fed and central banks around the world have been raising
interest rates to fight soaring inflation stemming from supply
chain problems related to the COVID-19 pandemic and an energy
crisis related to oil producer Russia's Ukraine invasion.
    As a result, all three major averages registered their
biggest one-year percentage declines since the 2008 financial
crisis, with the S&P 500 posting a 19.4% fall for 2022, Nasdaq
finishing down 33% and the Dow losing 8.7% for the year.  
        "There's uncertainty on the fundamentals, what the
economy is going to do, what the Fed is going to do, what
earnings are going to do. But also is the market going to start
off with a sell-off in January?" said James Ragan, Director of
Wealth Management Research D.A. Davidson in Seattle. 
  
        "There's that fear out there so, portfolio managers and
traders are just not wanting to be in a real risk-on position
going into the new year. That's what's been happening today and
all week."
  
    For Friday, the Dow Jones Industrial Average  .DJI  fell
73.55 points, or 0.22%, to 33,147.25, the S&P 500  .SPX  lost
9.78 points, or 0.25%, to 3,839.5 and the Nasdaq Composite
 .IXIC  dropped 11.61 points, or 0.11%, to 10,466.48.
        MSCI's world equity index  .MIWD00000PUS , was down
0.24% for the day, and showed a roughly 20% annual fall, its
largest since 2008, when it slid more than 43%.
    Along with domestic worries, investors around the world have
also been monitoring China, the world's second biggest economy,
for signs of weakness.
    China's health system has been under stress from soaring
COVID cases since it started dismantling strict restrictions
this month. Spain and Malaysia on Friday joined countries
imposing or considering imposing curbs on travellers from China.
    In currencies, the dollar has gained 7.8% over the year, but
it was on pace for a loss of 7.7% this quarter for its biggest
decline since the third quarter of 2010.
    The dollar index  =USD  fell 0.462%, with the euro  EUR=  up
0.39% to $1.0703 on Friday.
        The Japanese yen strengthened 1.36% versus the greenback
at 131.21 per dollar, while sterling  GBP=  was last trading at
$1.2082, up 0.25% on the day. 
  
        In fixed income, benchmark 10-year notes  US10YT=RR 
were up 4.4 basis points to 3.879%, from 3.835% late on
Thursday.
  
    U.S. crude oil futures registered a second straight annual
gain after a wildly volatile year marked by tight supplies due
to the Ukraine war and then sliding demand from China, the
world's top crude importer.
    For the day, U.S. crude  CLc1  settled up 2.4% or $1.86 at 
$80.26 per barrel and Brent  LCOc1  finished at $85.91, up $2.45
or 2.94% on the day.  O/R 
    Gold was showing its biggest quarterly gain since June 2020,
while the Fed's fast-paced tightening cycle had tempered
bullion's progress for the full year.
    Spot gold  XAU=  added 0.4% to $1,822.66 an ounce. U.S. gold
futures  GCc1  gained 0.15% to $1,819.70 an ounce.
    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
World FX rates YTD    http://tmsnrt.rs/2egbfVh
Global asset performance    http://tmsnrt.rs/2yaDPgn
Asian stock markets    https://tmsnrt.rs/2zpUAr4
MSCI Asia Pacific Ex-Japan index 25 year performance    https://tmsnrt.rs/3jCjnBI
Stock indexes 2022 performance    https://tmsnrt.rs/3G2SgY7
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Sinéad Carew, Chuck Mikolajczak, Carolyn Cohn,
Ankur Banerjee; Editing by Simon Cameron-Moore, Sam Holmes,
Philippa Fletcher, Chizu Nomiyama, Josie Kao and Diane Craft)
 ((sinead.carew@thomsonreuters.com))
 
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