Stock market sees double-digit gains in 2021 in pandemic rebound

Wall Street has had another record breaking year despite incredible hardships placed on the economy by another pandemic year. Credit: Unknown / CC BY-SA 3.0

The stock market ends 2021 with near historic highs after the slingshots and arrows thrown at it from another pandemic year.

After a slight decline, the market is expected to close at near record highs after an impressive year despite great uncertainty caused by lockdowns and supply shortages around the world.

Oil prices were another huge factor in the economy in the last quarter of 2021, with supply chain shortages exacerbated by political intrigue, but they retreated from a high of $ 80 a barrel after their largest annual increase since 2009.

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Stock markets are strong despite the almost continuous challenges of the pandemic

Stock markets edged down in sparse trading activity on Friday, but cemented double-digit gains for 2021, while the US dollar, which had its best year since 2015, appreciating 6.7%, remained stable against most of the world’s major currencies. .

Several exchanges in Europe and Asia were not open on Friday, giving experts a look at the end of the year after markets stopped trading in the United States on Friday.

The UK FTSE 100 fell 0.4% while the MSCI World Index was just 0.5% from record levels; it jumped an incredible 17% in 2021, its third consecutive year of double-digit gains, Reuters reports.

As many countries around the world report record high levels of coronavirus cases and many cities cut back on their public New Year’s celebrations, stocks continued to rally over the holidays as investors were reassured that the savings could effectively handle virus spikes; they are now heading for record highs.

Charalambos Pissouros, head of research at JFD Group, a Cyprus-based brokerage firm, explains “Regarding COVID, for now, market players may remain willing to increase their exposure to risk, and perhaps push stock indexes to new highs as several nations around the world have refrained from imposing further shutdowns despite record world infections in recent days. “

Corporate profitability despite the huge ups and downs in the economy over the last two years of the pandemic has led investors to be confident of a global recovery until 2022, feeling optimistic about the prospect of new gains.

The ‘whole rally’ the stock market experienced in 2021, with wads of cheap central bank liquidity, coupled with generous government stimulus funds and a strong economic rebound, made it difficult not to profit from prices. extremely high assets.

Pundits note that it was US stocks and others that fueled the global rally after record profits from big tech companies made investors happy. The S&P 500 also hit another record last week.

Commodity prices have had a solid year, with skyrocketing demands as economies around the world intensified after the reopening. Brent crude futures fell 0.8% to $ 78.87 a barrel and U.S. crude oil weakened 0.94% to $ 76.27 a barrel on Friday, according to a Reuters report .

But Brent and WTI have both risen more than 50% in the past year, driven by the global economic recovery and producers’ conservative tendency not to flood markets. While factory activity in China picked up somewhat in December, analysts believe they may experience more economic headwinds in the future.

Chinese stocks closed higher on Friday, ending higher; however, the blue chip CSI300 index lost 5.2% this year, its worst annual performance in three years.

Turkish lira drops for fifth day in a row

The Turkish lira, which has had an extremely tumultuous year due to the failure of its leader’s economic policies. Recep Tayyip Erdogan, fell for a fifth day in a row, coming out of 2021 as the biggest loser in the international currency market.

After falling sharply, the pound made some gains, but investors are clearly concerned about Turkey’s unorthodox monetary policy and skyrocketing inflation. Erdogan’s plan to defend lira deposits that was unveiled earlier this month has sparked widespread skepticism.

The euro ended the year above $ 1.13 after falling 7.4% this year after investors bet the European Central Bank would be slower to end pandemic stimuli than other banks power stations.

The Japanese yen, which has lost an incredible 11% against the US dollar this year, fell again on Friday, to 115.1 yen to the dollar; that’s close to the four-year lows that were seen earlier in December.

The British pound was broadly at its previous levels against the dollar and the euro.

Interestingly, the pound sterling had its best year since 2014 against the euro, as it fell slightly against the dollar. At one point on Friday, it jumped to 83.69 pence, its best performance since February 2020, just ahead of the worst of the pandemic.

Government bond markets were generally closed on Friday. Meanwhile, cryptocurrency prices have risen, offsetting some of their losses early last week. Bitcoin rose 2% to $ 48,091 and Ether rose by a similar amount, ending at $ 3,778.00

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