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Markets Update: Chinese Key Short-Term Rate Trimmed, Yuan Weakens. U.S. Inflation Data Expected to Support September Rate Cut. Wall Street Futures Rise Amid Biden’s Withdrawal.
Economic Calendar
Global Markets Roundup: 22 July 2024
Asian stocks slid further on Monday, showing minimal response to an unexpected rate cut by China’s central bank, while Wall Street futures rose following President Joe Biden’s decision to exit the election race. The People's Bank of China reduced short-term rates by 10 basis points, leading to a drop in long-term borrowing costs and bond yields. This move followed Beijing’s release of a policy document on Sunday detailing its economic ambitions. Investors appeared unimpressed, seeing the rate cut as an indication of economic fragility. Chinese blue chips 3399300 declined 0.9%, accompanied by a slip in the yuan.
MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) dropped another 0.7%, extending last week's 3% decline. Japan's Nikkei NI225 fell by 1.2%, while South Korea's KOSPI dropped 1.3%. Taiwan’s TWSE:TAIEX faced another tough session, losing 2.3% amid worries over U.S. restrictions on chip sales. Markets reacted calmly, with S&P 500 stock futures ES1! rising 0.1% and Nasdaq futures NQ1! gaining 0.2%. Futures for 10-year Treasuries (TYc1) increased by 2 ticks, while 10-year bond yields US10Y dipped by 2 basis points to 4.22%. EUROSTOXX 50 futures FESX1! went up 0.5%, and FTSE futures Z1! climbed 0.4%. Investors were more prepared for the news of President Biden stepping down and endorsing Vice President Kamala Harris for the Democratic ticket.
In currency markets, The USDJPY was 0.03% lower to 157.435, while the euro EURUSDÂ climbed 0.07% to $1.0891 and sterling GBPUSDÂ edged 0.08% higher to $1.2921.
In commodities and soft commodities, GOLD held steady at $2,406 an ounce, short of last week's record high of $2,483.60. Oil prices rose slightly, with little progress on a ceasefire deal in Gaza as Israeli forces continued to clash with Palestinian fighters in Rafah. Brent BRN1! gained 44 cents to $83.07 a barrel, while U.S. crude CL1! increased by 41 cents to $80.54 per barrel. Wheat on the CBOT ZW1! traded 1.2% higher at $5.49 a bushel, while corn ZC1! climbed 1.1% to $4.09-1/4 a bushel.
Europe’s largest banks will report this week, with attention on whether gains from higher interest rates are diminishing and if recent political developments are affecting sentiment. The week will conclude with the Federal Reserve's favored inflation measure, the core personal consumption expenditures index, expected to show a 0.1% rise in June, bringing the annual rate down to 2.5%. Additionally, advance GDP figures are anticipated to show growth accelerating to an annualized 1.9% in Q2, from 1.4% in Q1. The closely watched Atlanta Fed GDPNow indicator predicts 2.7% growth, suggesting an upside risk. The Bank of Canada is meeting on Wednesday, and is widely expected to cut rates by a quarter point to 4.5%.
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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