Global Stocks Mixed With Biden Adopting Traditional Dollar Stance

By Steve Goldstein

Updated Jan. 18, 2021 1:06 pm ET / Original Jan. 18, 2021 5:57 am ET

Outside a shopping mall complex during rush hour in Wuhan, China.

AFP via Getty Images

Global markets wavered on Monday, with weak U.S. consumption casting a shadow amid a report the incoming Biden administration will return to a traditional view of the U.S. dollar.

Trading was muted, with U.S. stock markets closed for the Martin Luther King Jr. holiday.

The Nikkei 225 dropped 1% in Tokyo and the Kospi Composite slumped 2.3% in Seoul.

The Hang Seng bucked the trend with a 1% advance, and the Shanghai Composite rose 0.8%, as China reported 2.3% growth for all of 2020—its slowest growth rate since 1976. In the fourth quarter, China’s economy expanded by 6.5%, according to the National Bureau of Statistics, slightly ahead of the 6.2% expected by economists.

The Stoxx Europe 600 rose 0.2%.

It was the first opportunity for traders in Asia to react to the news that U.S. retail sales slumped 0.7% in December.

Created with Highcharts 8.1.0

China's Economy Surges In Fourth Quarter

Year-over-year GDP growth.

Source: National Bureau of Statistics/FactSet

Created with Highcharts 8.1.0

%

2019

'20

-7.5

-5.0

-2.5

0.0

2.5

5.0

7.5

Aug. 30, 2019x6%

Also in the spotlight was a report from The Wall Street Journal that Treasury secretary nominee Janet Yellen will say the U.S. doesn’t back a weaker dollar.

“Of course, that doesn’t guarantee a stronger dollar—it just means they won’t take any direct steps to weaken it,” said Marshall Gittler, head of investment research at BDSwiss Group, who pointed out the dollar rose despite President Donald Trump’s oft-stated desire to weaken the U.S. currency. “U.S. dollar policy has generally been one of ‘benign neglect.’”

Shares of Carrefour slumped more than 6% on Monday after Canada’s Alimentation Couche-Tard ended its short-lived pursuit to buy the French supermarket giant.