Global market indices rise on big acquisition announcements, landmark new drug approval

Major global market indices rose at the close of business Friday helped by big acquisition announcements and a landmark new cancer drug approval in the United States, just as Nasdaq Composite posts biggest weekly gain of the year.

According to reports, the past week saw global investors, while navigating the damage caused by Hurricane Harvey and renewed tensions between the U.S. and North Korea, focusing on upbeat data on personal spending as well as steady job creation and low unemployment.

But some large acquisition announcements and a landmark new drug approval helped bolstered sentiments, which catapulted major indexes higher in the week ended September 1.

However, the Nigerian market seemed immune to the global developments as the Nigerian bourse’s benchmark index shed 35 basis points to close at 35,504.62 points, while year-to-date gain contracted to 32.1 percent in the review period. This as a result of investors booking profit on the previous weeks appreciation.

On the global turf, the Nasdaq Composite rose to its biggest weekly gain of the year, boosted by signs of strength in the U.S. economy and a rise in biotechnology companies.

Specifically, it added 6.67 points, or 0.1 percent, to 6435.33, a fresh record close.

It thus finished the week up 2.7 percent, lifted by an eight (8) percent rise in the Nasdaq biotechnology index in the period as biotech shares soared following the Food and Drug Administration’s approval of the first gene therapy in the U.S. on Wednesday.

The biotechnology group earlier got a boost from Gilead Sciences , which on Monday agreed to pay about $11 billion for Kite Pharma.

In other merger news, shares of United Technologies surged on Tuesday after The Wall Street Journal reported the aircraft-equipment maker was near a deal to buy Rockwell Collins for more than $20 billion. United Technologies ended the week up 2.5 percent.

The Dow Jones Industrial Average rose 39.46 points, or 0.2 percent, to 21987.56 on Friday, putting its weekly gain at 0.8 percent. The S&P 500 added 4.90 points, or 0.2 percent, to 2476.55, putting its weekly gain at 1.4 percent, its biggest since mid-July.

In Europe, the Stoxx Europe 600 rose 0.6% for the week. On Friday, shares of industrial goods and construction companies were among the best performers, as data showed activity in the Eurozone’s manufacturing sector increased in August to a 74-month high.

Earlier Friday, Asian shares mostly inched higher, with China’s market gaining slightly after a private gauge of Chinese factory activity rose in August for the third straight month. The Shanghai Composite Index rose 0.2 percent to its highest close since December 2015 as coal and steel stocks advanced. Stocks in Shenzhen added 0.6 percent.

Japan’s Nikkei Stock Average added 0.2 percent amid gains in energy companies, finishing the week 1.2% higher. The index ended a six-week losing streak, its longest since early 2014, with its biggest weekly gain since June.

In commodities, gasoline futures jumped 13 percent, for their biggest one-week percentage gain in more than five years, as Hurricane Harvey caused U.S. refinery and pipeline shutdowns. U.S.-traded crude oil fell 1.2 percent during the week to $47.29 a barrel.

The price of gold for September delivery jumped 2.5 percent to $1,324.50 an ounce during the past week following the missile launch in North Korea, uncertainty about when the Fed may next raise interest rates and a weaker dollar. The rise was gold’s biggest weekly gain since April.

Equally, stocks edged higher following a roughly-in-line jobs report on Friday.

Reports indicate that the pace of hiring slowed and the U.S. unemployment rate rose slightly last month, according to the Labor Department, but wages ticked up less than expected. This is good for stock prices, some analysts said, as wages are rising enough to spur more consumer-spending but not at a fast-enough pace to compel the Federal Reserve to raise interest rates.

“Thankfully, the improvement in the labor market is not leading to too-fast wage growth,” Sameer Samana, global quantitative and technical strategist at Wells Fargo Investment Institute told The Wall street Journal, adding “It’s right now in the sweet spot where it’s enough to drive consumption, but not enough to lead to inflation jumping up so the Fed feels it needs to be more aggressive. It’s also not affecting profit margins yet.”

In August, average hourly earnings ticked up 0.1 percent from the prior month, according to the Labor Department. Economists surveyed by The Wall Street Journal had expected earnings to rise 0.2 percent.