Japan stocks are soaring, global markets are higher, and the S&P 500 is set to match its longest earnings recession since the 1930s. Here’s what the market is talking about today:
Japan Shares Surge
Following the weekend election, Japan’s conservative party, led by Prime Minister Shinzo Abe, is set to secure the super-majority of its upper house of parliament. The prime minister’s victory would allow the conservative party to push forward with its constitutional reform plans.
Abe has also pledged to take action on the economy, calling for “gold economic measures.”
The Nikkei 25 Stock Average tacked on 4% after news of the election results. The Topix index gained 3.8%.
Global Markets Rise
The U.S.’s job report and Abe’s victory lifted shares in Asia and Europe. The MSCI Asia Pacific Index was 2.1% higher overnight. In China, the Shanghai Composite Index inched up 0.2%.
The Stoxx 600 Index in Europe advanced 0.7%, with commodity producers seeing the biggest gains.
S&P 500 futures climbed 0.3%.
S&P to Match 1930s Earnings Recession
Despite the fact that the S&P 500 closed just under its all-time high on Friday, the index is still set to match its longest earnings recession since the 1930s.
The S&P 500 is now trading at a higher multiple than it has for 90% of the time in the last 80 years. The only bright spot is that the drop in earnings isn’t as steep as the previous three declines.
Carney to Face the Treasury Select Committee Tuesday
Mark Carney, Bank of England governor, will face the Treasury Select Committee on Tuesday, just two days before the central bank makes its first interest rate decision after the Brexit vote. Economists expect the BoE to lower interest rates for the first time in seven years.
Meanwhile, Theresa May, the only remaining candidate in the race for prime minister, announced that she would be cracking down on corporate irresponsibility in a speech Monday morning.
