Investors were dealt a mixed hand last week as four of the seven indices closed higher. Japan’s Nikkei 225 jumped 1.37% to occupy the top spot last week. On a YTD basis France’s CAC 40 was the best performer with a gain of 14.63% followed by Germany’s DAX at +10.65%.
London’s FTSE 100 was the only index to escape last week’s market sell-off. The negative impact from the Volkswagen emissions scandal spread to other automobile (and component) manufacturers which led to the DAX assuming the dubious title of this week’s worst performer. Last week’s large sell-off in the DAX also meant it is now in negative territory on a YTD basis and this leaves France’s CAC 40 and Japan’s Nikkei 225 as the only indices in the black for the year thus far.
Bargain hunters went shopping last week as all but one of the indices I tracked finished higher; last week’s 2.9% gain in the S&P/TSX composite made it the top performer. Major oil-field services company Schlumberger also went shopping last week when it announced a deal to acquire smaller rival Cameron International in a cash and stock deal valued at approximately USD$12.7B. Germany’s DAX, France’s CAC 40, and Japan’s Nikkei 225 are still posting decent positive YTD numbers.
Each of the indices I track ended squarely in the red last week as negative news reports – corporate and economic – and large currency moves sent investors fleeing stocks.
The Chinese Yuan devaluation, disappointing Chinese manufacturing numbers, and poor earnings coupled with reduced forecasts from American blue chips Deere and HP were among the negative news bites which sent investors bailing out of stocks and seeking safety in treasuries.
On a more positive note, Germany’s DAX, France’s CAC 40 and Japan’s Nikkei 225 are still up 3.25%, 8.38%, and 11.38% respectively since the beginning of the year despite this week’s market carnage.
A review of how some of the major stock market indices did over the past week: