Zhitong Finance APP learned that the global stock market remained stable on the last trading day of this year, as the market digested the news of US economic data and China’s adjustment of epidemic prevention and control policies, but affected by high inflation and the conflict between Russia and Ukraine, the global stock index will fall by 20%. However, the greenback was on track for its best yearly performance in seven years, buoyed by rising interest rates in the US. “The stock market has been largely influenced by the Fed this year,” said David Bizer, managing partner of Global Customized Wealth, an investment management firm. and peak.”
Markets expect fed funds rate to peak near 5% by the middle of next year from the current 4.25-4.5%.
Since March, the Federal Reserve has raised interest rates by 425 basis points this year.
The S&P 500 is expected to be down 19% this year and the Dow is expected to be down 8.5% this year.
European stock markets may fall by 12% for the year. Britain's FTSE 100, which includes several exporters, is expected to rise more than 1% in 2022.
The MSCI index of stocks across the globe is set to drop 20% this year, its biggest annual drop since the 2008 global financial crisis, when it fell more than 40%.
MSCI The Asia-Pacific ex-Japan stock index is set to fall 19% this year, its worst performance since 2008.
The Nikkei 225 Index has fallen by more than 9% this year.
In the foreign exchange market , the dollar has risen more than 8% this year, but it has fallen more than 7% this quarter amid expectations that the Fed may not raise interest rates as aggressively as previously feared.
Sterling has fallen about 11 percent against the dollar this year and is on track for its worst year since the 2016 Brexit referendum.
The yen rose to a 10-day high of 131.72 per dollar on Friday, but the Bank of Japan's dovish policy has pushed the yen down 13 percent this year, its worst annual performance since 2013.
EUR/USD was steady at 1.0669 and is expected to fall 6% this year.
Investors have been worried that the major central banks policies to curb inflation may lead to an economic slowdown.
Analyst said that entering 2023, inflation still needs to be contained, and investors will also be wary of geopolitical tensions.
U.S. Treasuries and German bunds, the benchmarks of the global lending market, are down 16% and 24% this year, respectively, in dollar terms.
The yield on the 10-year U.S. Treasury bond rose 1 basis point to 3.84% on Friday, while the yield on the 10-year German bund rose 3.5 basis points to 2.5%.
U.S. crude futures rose 0.54% to $78.72 a barrel, and Brent crude futures rose 0.49% to $83.87 a barrel.
Brent crude is on track to rise 8% this year after rising 50.2% in 2021. U.S. crude oil is on track to rise 4.8% this year after rising 55% last year.
Gold was steady at $1816 an ounce.
