Britain and Europe
The London FTSE 100, Paris CAC and Frankfurt DAX rose on the month even though they faltered last week as cross currents buffeted investors into indecision. Mixed U.S. economic data combined with the ongoing saga of Enron's financial problems ate at investors' confidence. The markets seem to have paused for breath after rallying strongly in October and November on the back of interest rate cuts and the progress of the war in Afghanistan.

Traders were kept busy on Friday as investors reshuffled their portfolios in response to changes in the MSCI indices. MSCI changed the weightings of its indices, which are widely used by U.S. investors, at midnight on Friday. (See currencies below for more on the MSCI change.)

The French and German markets, despite the decline on the week, were firm Friday, with strength in technology stocks among others. The first half of the MSCI index re-weighting took effect from midnight on Friday night. The changes involve large amounts of indexed funds flowing out of stocks such as Deutsche Telekom and France Telecom and into holdings in Britain, Canada and the United States.

Asia
The Nikkei ended the week slightly higher as Japanese equities were buoyed by the larger than anticipated increase in U.S. durable goods orders which rebounded from their dismal September levels. But at the same time, investors worried about the impact of the Enron debacle on already debt burdened Japanese banks. Market gains were also limited by poor economic data, which showed the Japanese unemployment rate hitting a fresh post war high of 5.4 per cent while the consumer price index fell 0.7 per cent when compared with last year, highlighting the weak domestic environment for Japanese corporations.

The Hong Kong Hang Seng was lifted also by the U.S. durable goods order report, which could mean rising exports. Investors were looking to real estate developers for signs of improvement as liquidity improved thanks to interest rate cuts, which mirror those in the United States.

For the month of November, all Asian indexes followed here rose, with the South Korean Kospi outperforming the others. Hong Kong Hang Seng, the Singapore Straits and Australian all ordinaries followed. Both the Kospi and all ordinaries are higher than they were at the end of 2000.

Introduction   •   Global Stock Market Indexes   •   Recap of Global Markets   •   Currencies   •  Indicator Scoreboard

The Bottom Line   •   Looking Ahead