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Markets Update: APAC Stocks Pressured by Chinese Economic Woes and Developer Default Concerns
Economic Calendar
Global Markets Roundup: 14 Aug 2023
Asian stock markets were pressured on Monday amid ongoing Chinese economic woes and developer default concerns. The Hang Seng Index fell by 1.1%, the Shanghai Composite Index fell by 0.8%, and the Nikkei 225 fell by 0.6%.
The sell-off in APAC stocks came as investors continued to worry about the impact of China's property crisis on the global economy. China Evergrande Group, the world's most indebted developer, is facing a potential default on its debt, which could have a ripple effect through the global financial system.
Goldman Sachs Sees Fed Beginning Rate Cuts in Late 2024
Goldman Sachs said on Monday that it expects the Federal Reserve to begin cutting interest rates by the end of June 2024 at a gradual pace. The investment bank said it anticipates the Fed to cut rates once per quarter, starting with a 25 basis point reduction.
Goldman Sachs's forecast is more dovish than the consensus view, which expects the Fed to begin raising interest rates in 2023. However, the investment bank said it believes that the Fed will be forced to cut rates in 2024 as the US economy slows down and inflation falls.
European Equity Futures Lower Ahead of Key Central Bank Meetings
European equity futures were lower on Monday ahead of key central bank meetings. The Euro Stoxx 50 futures contract was down by 0.4%, as investors awaited the decisions of the Bank of England (BoE) and the Swiss National Bank (SNB).
The BoE is expected to raise interest rates by 25 basis points on Thursday, while the SNB is expected to keep rates unchanged. However, investors will be closely watching the BoE's forward guidance for any hints about future rate hikes.
DXY Firmer and Just Below the 103 Mark The US dollar index (DXY) was firmer on Monday and was just below the 103 mark. The DXY was supported by the prospect of the Fed beginning to cut interest rates in 2024. Sure, here is a better, more professional and streamlined text with better wording based on the exact information you provided:
EUR/USD was lacklustre after several recent failed attempts to reclaim the 1.1000 level. The single currency was limited by quiet weekend newsflow from the eurozone.
GBP/USD marginally extended its retreat with the attention for the UK this week on jobs and inflation data.
The pound was weighed down by concerns about the UK economy, which is facing headwinds from the cost of living crisis and the war in Ukraine.
However, GBP/USD was supported by expectations of a Bank of England (BoE) rate hike later this week. The BoE is expected to raise interest rates by 25 basis points on Thursday.
The Japanese yen (JPY) was weaker against the US dollar, with USD/JPY briefly climbing above 145. The JPY was weighed down by the prospect of the BoJ continuing to maintain its ultra-loose monetary policy.
AUD Lags the Majors Due to Chinese Economic Concerns The Australian dollar (AUD) was the worst performer among the major currencies on Monday, as it lagged the US dollar, euro, and yen. The AUD was weighed down by concerns about the impact of China's economic woes on the Australian economy.
COMMODITIES
Crude futures were mildly pressured in risk-off conditions amid China's economic concerns. Investors sold risk assets, including crude oil, as they became more concerned about the impact of China's economic slowdown on global growth.
Spot gold traded uneventfully with the precious metal restricted by recent greenback strength. The US dollar rose against a basket of currencies, making gold more expensive for buyers holding other currencies.
Copper futures retreated amid jitters related to developers in the world's largest copper buyer. China's property sector is facing a crisis, and there are concerns that this could lead to a slowdown in demand for copper, which is used in construction.
Looking Ahead Highlights include:
BoE Interest Rate Decision
SNB Interest Rate Decision
US Retail Sales
US Consumer Sentiment
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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