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Published: August 28, 2023
Updated: August 28, 2023

Market Recap: 5 Game-Changing Events Over the Weekend

The markets are buzzing with significant shifts that unfolded over the weekend, paving the way for a dynamic trading week ahead. From global cues to strategic moves in China, here's what you need to know:

1. China's Market Support Measures:

Asian markets kicked off the week on a positive note as China introduced fresh measures to bolster its struggling markets. These actions were followed by an air of caution as investors await crucial US job and inflation data. Japan's Nikkei 225 and Topix registered gains of 0.93% and 0.89% respectively. South Korea's Kospi surged by 0.41%, while Hong Kong's Hang Seng index futures showed promise at around 17,970.

2. US Fed's Stand on Rates:

The US stock market witnessed an upward trajectory on Friday after US Federal Reserve Chairman Jerome Powell's balanced speech at the Jackson Hole Symposium. The Dow Jones Industrial Average gained 0.73%, the S&P 500 surged by 0.67%, and the Nasdaq Composite closed 0.94% higher. Powell emphasized the Fed's willingness to raise interest rates to curb inflation, signaling a cautious approach to policy shifts.

3. China's Strategic Market Moves:

China made pivotal moves to attract investors and boost market confidence. The stamp duty on stock trades was halved from 0.1% to 0.05%, effective August 28. Additionally, Beijing committed to slowing the pace of initial public offerings (IPOs) and regulating major shareholders' share reductions. These actions aim to reinvigorate the Chinese stock markets and reassure stakeholders.

4. Evergrande Group's Financial Update:

China's indebted property giant, Evergrande Group, reported a narrower net loss for the first half of the year. The group's net loss declined to 33 billion yuan ($4.53 billion) from 66.4 billion yuan in the same period last year. While its first-half revenue rose by 44% year-on- year, liabilities and total assets saw slight reductions. This development comes amidst a challenging period for Evergrande, characterised by debt defaults and operational challenges.

5. Indian Market Outlook:

The Indian stock market is poised to open higher on Monday, influenced by positive global cues and gains in Asian and US markets. This week, investors will closely watch events such as Reliance Industries' annual general meeting (AGM), macroeconomic data releases, and international market trends. The market remained in a narrow range in the previous week due to concerns over inflation and liquidity, prompting mid and small cap sectors to remain active.

The weekend unveiled a series of significant events that set the tone for the coming week. With a blend of global cues and strategic shifts in key economies, investors are poised for an eventful and potentially transformative trading experience.