European shares set to climb as global stock markets near record highs
LONDON — European markets are poised to open higher on Wednesday as major indexes worldwide approach record highs. The pan-European Stoxx 600 index closed the Friday session, the last before the Christmas break, at 477.6, registering a 12.41% increase for the year, just below the index’s record closing high of 483.44 achieved in November 2021.
Trading in European markets was closed on Monday and Tuesday for the observance of Christmas Day and Boxing Day, but the positive sentiment is expected to carry over into the new trading week.
Meanwhile, the S&P 500 in the United States is also looking to reach an all-time high following another successful day on Wall Street. U.S. stock futures showed mostly flat movement in early premarket trade on Wednesday.
In Asia-Pacific, stocks made significant gains overnight, with Chinese and Hong Kong indexes bouncing back driven by strong performance in the video game sector. Australia’s S&P/ASX 200 also reached its highest level since April 2022.
Trading volumes are expected to be low during the final three days of the trading year, as fewer economic data points and major central bank meetings are scheduled.
Some investors may take advantage of the quiet period to rebalance their portfolios or make adjustments, said an industry expert. However, overall trading activity might be limited as many market participants are still away for the holidays.
As the year draws to a close, market focus shifts to evaluating the performance of different asset classes and anticipating the trends that may shape the coming year.
While the markets have had a strong run in 2023, there are concerns about potential headwinds, such as inflationary pressures and central banks shifting their monetary policies, noted an economist.
Despite these concerns, investors remain optimistic about the overall market performance. With global stock markets nearing record highs, it reflects increased investor confidence and a positive outlook for the future.
However, analysts highlight the importance of keeping a balanced approach and monitoring market developments closely to navigate potential risks and opportunities in the year ahead.
While the market outlook remains positive, traders anticipate thin trading activity during the final days of the year as market participants wind down and take time off for the holidays.
In summary, European shares are expected to climb as global stock markets approach record highs, reflecting the positive sentiment and confidence among investors. However, with trading volumes anticipated to be thin during the remaining days of the year, market participants will closely monitor market developments and prepare for potential challenges and opportunities in 2024.
