St. Nicholas skips global markets

The much-anticipated Santa Claus rally on Wall Street fizzled off Friday as tech stocks slid lower, while a weaker yen lifted Japanese equities.

US indices slumped to end the holiday week, with the tech-heavy Nasdaq Composite losing 1.5 percent.

The trend echoed in other global markets.

The Philippine Stock Exchange index (PSEi) ended 2024 lower.

Shares in Tesla were closed around 5.0 percent lower, while those in AI chipmaker Nvidia shed around 2.0 percent.

Wall Street stocks have historically performed well around the year-end holidays in what is popularly known as a Santa Claus rally.

A Christmas Eve jump in equities got the Santa rally off to a flying start and indices barely budged in Thursday trading.

Briefing.com analyst Patrick O’Hare also pointed to an increase in 10-year US Treasury bond yields to around 4.6 percent, which he noted is a rise of nearly 0.9 percentage points since the US Federal Reserve made its first recent interest rate cut in September.

“The Fed doesn’t hold sway over longer-dated maturities like it does over shorter-dated securities, so the bump in rates at the back end of the curve is being watched with an anxious eye as a possible harbinger of a pickup in inflation and/or the budget deficit,” O’Hare said.

Wall Street stocks took a knock earlier this month when the Fed indicated it would likely cut interest rates less than it had previously expected to.

That was in part because of uncertainty tied to President-elect Donald Trump’s vow to raise import tariffs, which could boost inflation that is already proving sticky.

Nikkei flat

In Asia, Japan’s Nikkei index closed up nearly two percent, with the yen’s recent weakness proving a boon for major exporters.

The yen hit 158.08 per US dollar on Thursday evening — its lowest in almost six months — following comments made by Bank of Japan Governor Kazuo Ueda that failed to give a clear signal on a possible interest rate increase next month.

Recent data has showed Japan’s inflation rose for a second month in December, while industrial production declined less than expected in November and retail sales came in higher than estimated last month.

Japan’s government also on Friday approved a record budget for the next fiscal year, ramping up spending on social welfare for its ageing population and on defense to tackle regional threats.

In Seoul, the stock market closed down one percent after the won plunged to a nearly 16-year low of 1,487.03 against the dollar on Friday morning.

South Korea is struggling to emerge from political turbulence in the wake of President Yoon Suk Yeol’s martial law declaration this month, which prompted his impeachment.