International
Stocks stumble to end ‘miserable’ 2022
| By AFP | Roland Jackson |
Stock markets wrapped up their worst performances in years on Friday before heading into 2023 under recession fears following Russia’s invasion of Ukraine, high inflation and rising interest rates.
Both US and European indices closed their final sessions of the year in the red.
For the year, Frankfurt was down more than 12 percent and Paris lost 9.5 percent for their worst performances since 2018. London, however, was up 0.9 percent in 2022 as the energy sector was buoyed by soaring energy prices.
Wall Street saw its worst annual drop since 2008, with the S&P 500 index down around 20 percent and the tech-heavy Nasdaq losing about 30 percent for the year.
Equities were slammed as the US Federal Reserve, European Central Bank and Bank of England aggressively lifted interest rates in a bid to tackle rampant consumer price rises. The move carries the risk of sparking recession as higher borrowing costs slow economic activity.
US tech companies were hit particularly hard as they are usually boosted by lower interest rates.
The MCSI World Equity Index has lost almost a fifth in its worst annual performance since 2008, when markets were ravaged by the global financial crisis.
Asia-Pacific markets finished their last sessions mostly in the green on Friday.
But for the year, Hong Kong tanked 15.5 percent and Shanghai dived 15.1 percent in the biggest annual slumps since 2011 and 2018, respectively.
Covid spiked once more in China in December, after Beijing relaxed its strict curbs in the face of rare public outcry. The surge has also prompted worries about the impact on stretched global supply chains.
Tokyo plunged 9.4 percent in the first annual fall since 2018 but the Bank of Japan maintained its ultra-easy monetary policy, in contrast with other central banks, to help its fragile economy.
‘Pitiful end to miserable year’
“It’s shaping up to be a pitiful end to a miserable year in stock markets,” OANDA trading platform analyst Craig Erlam told AFP.
He said 2022 had “brought an end to an era” of low interest rates that fueled tech and crypto booms.
“That’s been replaced with soaring inflation and interest rates, immense economic uncertainty and the reshaping of energy markets in the aftermath of the Russian invasion of Ukraine,” Erlam added.
In commodities, oil prices rallied in 2022 with Brent gaining about 10 percent and the West Texas Intermediate adding around seven percent.
However, they remain significantly below peaks struck in March on supply woes after key producer Russia invaded its neighbor, sending natural gas prices also spiking.
Britain and other major economies now face the likely prospect of grim recessions next year, as consumers and businesses battle rampant inflation and rising rates after years of ultra-low borrowing costs.
“The most important take of the year is: the era of easy money ended, and ended for good,” noted SwissQuote analyst Ipek Ozkardeskaya.
“And given that there is still plenty of cheap central bank liquidity waiting to be pulled back, the situation may not get better before it gets worse,” she said.
“Recession, inflation, stagflation will likely dominate headlines next year.”
London was down 0.8 percent and Frankfurt shed 1.1 percent in half-day sessions ahead of the New Year holiday. Paris closed 1.5 percent lower.
On Wall Street, the Dow ended 0.2 percent lower while the tech-heavy Nasdaq shed 0.1 percent.
“It would appear that people have checked out for the year — and have settled back into holiday mode for New Year celebrations,” Erlam said.
Key figures around 2145 GMT
New York – Dow: DOWN 0.2 percent at 33,147.25 (close)
New York – S&P 500: DOWN 0.3 percent at 3,839.50 (close)
New York – Nasdaq: DOWN 0.1 percent at 10,466.48 (close)
London – FTSE 100: DOWN 0.8 percent at 7,451.74 (close)
Frankfurt – DAX: DOWN 1.1 percent at 13,923.59 (close)
Paris – CAC 40: DOWN 1.5 percent at 6,473.76 (close)
EURO STOXX 50: DOWN 1.5 percent at 3,793.62 (close)
Tokyo – Nikkei 225: FLAT at 26,094.50 (close)
Hong Kong – Hang Seng Index: UP 0.2 percent at 19,781.41 (close)
Shanghai – Composite: UP 0.5 percent at 3,089.26 (close)
Euro/dollar: UP at $1.0704 from $1.0667 on Thursday
Pound/dollar: UP at $1.2094 from $1.2062
Euro/pound: UP at 88.47 pence from 88.40 pence
Dollar/yen: DOWN at 131.11 yen from 132.96 yen
West Texas Intermediate: UP 2.4 percent at $80.26 per barrel
Brent North Sea crude: UP 2.9 percent at $85.91
International
Mexico requests extradition of ‘Mini Lic’ for murder of journalist Javier Valdez
The Mexican government has requested the extradition of Dámaso López Serrano, a former high-ranking member of the Sinaloa Cartel, who is accused of masterminding the 2017 murder of Mexican journalist Javier Valdez, the Attorney General’s Office announced on Tuesday.
López Serrano, known as “Mini Lic,” was arrested last Friday in Virginia, United States, on charges of fentanyl trafficking, a crime he committed while on parole.
“This is the key issue for us, he [López Serrano] is the mastermind of this murder. The rest of the perpetrators are already processed and in jail, he was the one missing,” said Attorney General Alejandro Gertz.
“We immediately made the extradition request,” the official added during the routine morning press conference of President Claudia Sheinbaum.
Valdez, an award-winning reporter specializing in drug trafficking and correspondent for AFP and the newspaper La Jornada, was murdered on May 15, 2017, in front of the office of his magazine Riodoce in Culiacán, the capital of Sinaloa state.
“Mini Lic” was originally arrested in 2017 when he voluntarily turned himself in to U.S. authorities and pleaded guilty to trafficking methamphetamine, heroin, and cocaine. In 2022, he was released on parole.
Gertz confirmed that the Mexican Attorney General’s Office had requested López Serrano’s extradition “countless times,” but Washington had declined to act on the request because he had become a “protected witness” for the U.S. government and “was providing a lot of information.”
“Now, with this situation where they themselves are acknowledging that this individual is still committing crimes, I think there are more than enough reasons for them to support us,” the prosecutor added.
The Sinaloa Cartel is one of the largest drug trafficking organizations in Mexico and was founded by Joaquín “El Chapo” Guzmán, who is serving a life sentence in the United States.
Culiacán has been shaken by a wave of murders since the arrest of Ismael “Mayo” Zambada, another key leader of the cartel alongside Guzmán, on July 25 in New Mexico, United States.
International
Cuba’s government stresses openness to serious, respectful U.S. relations
Cuba reiterated on Tuesday its willingness to engage in dialogue with the United States, just weeks before Republican President Donald Trump assumes office. During his first term, Trump halted the historic rapprochement between the two countries, which had been initiated just ten years earlier by Democrat Barack Obama.
“It will not be Cuba that proposes or takes the initiative to suspend the existing dialogues, to suspend the existing cooperation. Not even the discreet exchanges on some sensitive issues,” said Cuban Deputy Minister of Foreign Affairs Carlos Fernández de Cossío at a press conference in Havana.
“We will be attentive to the attitude of the new government, but Cuba’s stance will remain the same as it has been for the last 64 years. We are willing to develop a serious, respectful relationship with the United States, one that protects the sovereign interests of both countries,” he added.
His statements come on the occasion of the tenth anniversary of the historic rapprochement announcement between Washington and Havana.
On December 17, 2014, Cuban leader Raúl Castro (2006-2021) and Barack Obama (2008-2016) announced the beginning of a thaw in relations, which led to the restoration of diplomatic ties in 2015, after more than half a century of confrontation.
This process of thawing bilateral relations was later halted by businessman Donald Trump, who significantly reinforced economic sanctions against the communist-ruled country. The Republican will return to the White House on January 20.
Cuba, under a U.S. trade embargo since 1962, was re-listed in 2021 on the “blacklist of countries supporting terrorism,” blocking financial and economic flows to the island of 10 million inhabitants.
Subsequently, the administration of current Democratic President Joe Biden made only slight adjustments to the sanctions and also kept Cuba on this list. However, his administration resumed bilateral contacts with Havana on migration issues and the fight against terrorism.
International
Mexican government to use church atriums for gun surrender program to combat violence
The atriums of Mexican Catholic churches will be used for the voluntary surrender of weapons in exchange for economic and legal incentives as part of a plan announced on Tuesday by the government to reduce violence.
According to the Mexican government, there is a link between the illegal trafficking of weapons—almost entirely coming from the United States—and the spiral of criminal violence that has plagued the country since late 2006, when a controversial military anti-drug offensive was launched.
“The idea is to set up areas in the church atriums where people can voluntarily surrender their weapons, and in return, they will receive financial resources based on the weapon they are turning in,” explained President Claudia Sheinbaum during her regular press conference.
The left-wing leader emphasized that the program, called “Yes to Disarmament, Yes to Peace,” guarantees that those who surrender their weapons will not face any “investigation.”
“What we want is to disarm. This will be implemented next year. We also did it in Mexico City, and it had significant results,” added the former mayor of the capital, with a population of 9.2 million.
The disarmament plan is part of the government’s “comprehensive security strategy,” one of whose pillars is promoting a culture of peace, especially in regions severely affected by organized crime violence, Sheinbaum pointed out.
More than 450,000 people have been murdered in Mexico since the government launched its military-led anti-drug operation, alongside about 100,000 people who have gone missing.
Despite being a secular state, the Mexican Catholic Church has played a key role in efforts to contain violence, with priests acting as mediators between citizens and criminals. Several clergy members have been killed for this cause.
Just last week, the Catholic hierarchy called on cartels to declare a truce in their violent actions during the celebration of the Virgin of Guadalupe on December 12 and the upcoming Christmas holidays.
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