Australia

Australian shares are set to slip on the first trading day of 2024.

ASX futures were 23 points or 0.30% lower at 7584 as of 29 December 2023.

US markets were closed for the public holiday on Monday. The S&P 500 finished the year up 24%, just 0.6% from its January 2022 record. The Dow Jones Industrial Average advanced 14% to top 37000 for the first time and set seven record closes in the final days of 2023. A mania surrounding artificial intelligence and big technology stocks sent the Nasdaq Composite soaring 43%, its best year since 2020.

On the last trading day of 2023 in commodity markets, Brent crude oil fell 0.14% to $U77.04 a barrel and Gold fell 0.13% to $US 2,062.98.

In local bond markets, yields on Australian 2 Year government bonds was down at 3.70% and the 10 Year yield moved down to 3.95%. Overseas, the US Treasury notes climbed, with the yield on 2 Year fell to 4.25% and 10 yield flat at 3.88%.

The Australian dollar retreated to 68.10 US cents. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies was down at 95.77.

Asia

Asian markets were closed for the public holiday. Chinese shares closed higher in the last trading day of 2023, led by tech hardware and software stocks. The Shanghai Composite Index rose 0.7% to 2974.93, ended 2023 3.7% lower. The Shenzhen Composite Index added 1.1% for the day while the tech-heavy ChiNext Price Index gained 0.6%. The CSI 300, which measures the largest 300 companies traded in Shanghai and Shenzhen, posted a third straight yearly loss. Analysts remain concern about the outlook for Chinese markets in 2024 due to the continued property downturn and sluggish economic recovery. Among the day's risers was Hangzhou Hikvision, up 2.6%, and Foxconn Industrial Internet, which gained 2.2%. Beijing Kingsoft Office put on 0.85% and iFlytek advanced 0.7%. China Mobile rose 1.9% and China Telecom gained 1.1%. 

Hong Kong shares ended flat but fell 14% for the year of 2023, its fourth consecutive annual loss. Chinese property shares were the main drag, with the Hang Seng Mainland Properties Index down 40% in 2023. Analysts say they expect China's property downturn to continue weighing on markets. On Friday 29 December 2023, the benchmark Hang Seng Index closed flat at 17047.39 and the Hang Seng Tech Index was little changed at 3764.29. Gains in pharmaceutical and auto stocks offset losses by tech hardware companies. Hansoh Pharmaceutical advanced 6.3% and Li Auto climbed 1.8%. Xiaomi dropped 4.2% and SMIC declined 1.7%. 

Japan's Nikkei Stock Average ended slightly lower but rose 28% for 2023, making it Asia-Pacific's top performer as risk appetite recovered amid expectations of Fed rate cuts in 2024. The market also got a boost from a weak yen, which helped lift sentiment toward export-driven companies. "Within equities, Japan is our most preferred region and only overweight," Morgan Stanley said in a recent 2024 Global Strategy Outlook. It added that the country is more insulated from downside risks to Asia growth and geopolitical risks. On Friday, the Nikkei closed 0.2% lower at 33464.17 on profit-taking in conglomerates. USD/JPY was at 141.33, compared with 141.41 in late New York trading Thursday 28 December 2023. The currency pair has risen nearly 8% in 2023. 

Indian shares closed slightly lower on 29 December 2023, weighed by the banking sector. The benchmark Sensex ended 0.2% lower at 72240.26 after hitting record highs this week. It rose 19% for the year. "2023 was an astounding year for Indian equities," Axis Securities chief investment officer Naveen Kulkarni said. On Friday, State Bank of India led declines on the index with a 1.4% drop. IndusInd Bank and ICICI Bank fell 1.0% and 0.9%, respectively. Among gainers, Tata Motors rose 3.5%, Nestle India added 1.35% and Tata Steel climbed 1.0%. In 2024, elections in India and the U.S. will likely lead to increased volatility for equity markets, Kulkarni said. 

Europe

European stocks rose on the final trading day of 2023, with the Stoxx Europe 600 up 0.2% at 479.19, bolstered by lower bond yields and expectations that interest rates will be cut in 2024. "Focus is on the U.S. S&P 500 and the chance for a new historic high record break," Bob Savage, head of markets strategy at Bank of New York Mellon, says in a note. The Stoxx 600 ended the year of 2023 around 11% higher; Germany's DAX was index up 19%; France's CAC-40 up 15%; and the U.K.'s FTSE 100 lagged, up just 3%. The FTSE 100 closed 0.1% higher on a shortened U.K. trading day. The DAX and CAC-40 were last up 0.3%. 

North America

US markets were closed for the public holiday on Monday. The S&P 500 finished the year up 24%, just 0.6% from its January 2022 record. The Dow Jones Industrial Average advanced 14% to top 37000 for the first time and set seven record closes in the final days of 2023. A mania surrounding artificial intelligence and big technology stocks sent the Nasdaq Composite soaring 43%, its best year since 2020.