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Markets Update: APAC Stocks Conclude Mixed as Positive Sentiment Wanes; ASX 200 Briefly Extends Gains on Gold, Financials and Healthcare; Nikkei 225 Tops 33,500; KOSPI Edges Lower; Hang Seng and Shanghai Comp Move Volatile; PBoC Drains CNY 2.423tln
Economic Calendar
Global Markets Roundup: 05 Jan 2024
Asian markets ended mixed on Friday, with early gains giving way to a decline due to lack of major newsflow. The DXY briefly breached the 102.50 level, while USD/JPY inched towards 145 before paring back gains. EUR/USD remained subdued after falling under 1.0950. Crude futures rose to a one-month high, supported by geopolitical tensions in the Middle East. Politico sources suggested that the US is drafting plans to retaliate against Iran-backed Houthi militants, adding to the risk premium. South Korea ordered an evacuation of Yeonpyeong Island near the North Korean border due to the ongoing tensions with Pyongyang, adding to geopolitical uncertainty. European equity futures are pointing to a softer open, with the Euro Stoxx 50 futures down 0.5% after closing 0.6% higher on Thursday.
ASX 200 was initially supported by gold-related names alongside the Financials and Healthcare sectors, but gains were later countered by losses in Tech. The index closed up 0.07% at 7,595.00. Nikkei 225 outperformed and briefly topped 33,500 with the weak JPY providing tailwinds. The index closed up 0.37% at 33,504.78. KOSPI fell into the red after South Korea ordered an evacuation of Yeonpyeong Island near the North Korean border due to the ongoing tensions with Pyongyang. The index closed down 0.13% at 2,583.68. Hang Seng and Shanghai Composite moved between gains and losses but held a downside bias towards the end of the session. Hang Seng closed down 0.54% at 16,556.44. Shanghai Composite closed down 0.1% at 2,954.05. PBoC Drains CNY 2.423tln
The People's Bank of China (PBoC) drained a net CNY 2.423tln ($341.5bn) through open market operations this week, marking the biggest weekly cash withdrawal on record, according to Reuters calculations. The PBoC's move to drain liquidity from the market comes as it seeks to control inflation and slow economic growth. The central bank has been tightening monetary policy in recent months, raising interest rates and reserve requirements.
FX
DXY traded in a tight range but briefly breached 102.50 to eventually match yesterday's high of 102.53. EUR/USD was subdued after it fell under its 21 DMA (1.0951) and the psychological 1.0950 mark. GBP/USD met resistance just under 1.2700 at 1.2696 before printing a low of 1.2680. USD/JPY held an upward bias throughout the session and inched closer to 145.00 before hitting resistance at 144.95 and trimming earlier gains. AUD and NZD initially outperformed before trading flat as risk sentiment ticked lower in the run-up to US data. PBoC set USD/CNY mid-point at 7.1029 vs exp. 7.1593 (prev. 7.0997).
Commodities Markets Edge Higher on Cautious Risk Sentiment, Geopolitical Tensions
Global commodities markets exhibited a mixed performance on Friday, with crude oil futures, spot gold, and copper futures all posting modest gains amidst a backdrop of cautious risk sentiment and lingering geopolitical tensions. Crude Oil Futures Edge Up on Geopolitical Tensions Crude oil futures traded marginally higher in APAC hours, buoyed by reports that the US is considering a plan to retaliate against Iran-backed Houthi militants. The rally was modest, however, as market participants awaited further developments in the geopolitical situation. Spot Gold Navigates Risk Sentiment, Holds Near $2,050/oz Spot gold prices maintained their upward trajectory, edging higher in tandem with the US Dollar. Despite the gains, price action remained subdued ahead of the closely-watched US Nonfarm Payrolls (NFP) data. Copper Futures Waver Amid Cautious Risk Sentiment Copper futures traded between mild gains and losses throughout the session, reflecting the broader cautious risk sentiment. The metal remained under pressure from concerns about global economic growth.
Key economic data releases scheduled for Friday include German Retail Sales, UK Halifax House Prices, EZ Flash CPI, Producer Prices, Canadian Leading Index, US NFP, Durable Goods, ISM Services Employment Index, Canadian Ivey PMI, and a speech from Fed's Barkin.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team
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