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Markets Update: China Takes the Lead in Mixed Trading in APAC
Economic Calendar
Global Markets Roundup: 24 Oct 2023
APAC stocks displayed a mixed performance, echoing Wall Street's lead, with Mainland China leading gains overnight. The diverse movements reflected the regional variations in market sentiment.
**Forex Markets Witness Shifting Dynamics:**
The Dollar Index (DXY) eventually dipped below the 105.50 mark, influenced by Treasury yields maintaining losses. In the currency pairs, EUR/USD surpassed its 50-day moving average, while USD/JPY tested 149.50 to the downside, indicating a degree of volatility and shifting sentiment.
**Bitcoin's Rollercoaster Ride:**
Bitcoin experienced a volatile session, initially surging to levels near USD 35,000 before a pullback to around USD 33,000. The cryptocurrency then stabilized around USD 34,500, with some attributing the price fluctuations to optimism surrounding Exchange-Traded Funds (ETFs).
**European Equities Set for a Marginally Softer Open:**
European equity futures signaled a slightly softer open, with the Euro Stoxx 50 future down by 0.1%. This comes after cash markets closed with a 0.4% gain yesterday, reflecting the nuanced market sentiment.
**ASX 200 Advances, Driven by Metals & Mining:**
The ASX 200 exhibited positive momentum, propelled by the Metals & Mining sector, building on the prior session's gains in the complex. However, gold-related stocks faced headwinds as the precious metal shed some geopolitical risk premium over the weekend.
**Nikkei 225 Struggles Below 31,000:**
The Nikkei 225 faced challenges in maintaining the 31,000 level during early trading. The firming of the Japanese Yen from the preceding session weighed on the export-heavy index, contributing to its early struggles.
**Mixed Start for Hang Seng and Shanghai Comp:**
Hang Seng and Shanghai Comp had a mixed opening, with Hang Seng playing catch-up after an extended weekend. Meanwhile, Shanghai Comp gained ground amid reports indicating that the US and China engaged in the first working group meeting, contributing to positive sentiment.
These varied movements in regional markets underscored the nuanced dynamics at play, influenced by sectoral performances, currency fluctuations, and geopolitical developments. Market participants are closely monitoring these factors for potential shifts in sentiment and trading patterns.
**FX Markets Navigate Dollar's Retreat:**
The Dollar (DXY) experienced a dip below the crucial psychological level of 105.50 as Treasury yields retained losses. Notably, the Dollar's downside potential includes its 50-day moving average at 105.187. Major currencies in the G10 basket strengthened against the Dollar, each to varying extents.
- **EUR/USD Advances Beyond Previous Peaks:**
EUR/USD surpassed yesterday's peak of 1.0677 and its 50-day moving average at 1.0678, benefitting from the Dollar's decline.
- **GBP/USD Rises on Dollar Weakness:**
GBP/USD also saw gains as the DXY retreated, eventually surpassing the high of 1.2258 from the previous session.
- **JPY Holds Ground Amid Dollar Decline:**
JPY maintained its strength from the prior day, with USD/JPY testing 149.50 on the downside after reaching a high of 149.78 during the APAC session.
- **Antipodeans Shine Despite PMI Decline:**
Antipodean currencies outperformed, with the Australian Dollar leading the pack, showing resilience even in the face of PMI deterioration. This strength correlated with an upswing in mainland Chinese equity markets.
**Fixed Income Dynamics:**
- **UST Futures Retain Gains:**
10-year UST futures held on to the gains from the previous day, witnessing a substantial bull-flattening as news broke that Bill Ackman was closing his US bond short.
- **Bund Futures Eye ECB Meeting:**
Bund futures edged above yesterday's high of 128.36, approaching the 128.50 mark, with market participants anticipating developments from the upcoming ECB conference.
- **JGB Futures Find Support:**
10-year JGB futures found support following the BoJ's announcement of unscheduled purchases in the 5-10-year and 10-25-year maturity buckets.
**Commodities Navigate Geopolitical Landscape:**
- **Crude Futures Consolidate Post-Selloff:**
Crude futures stabilized after Monday's decline, attributed to a lack of escalation in the Israel-Hamas situation, prompting an unwinding of geopolitical risk premium. Brent oil reclaimed a handle above USD 90/bbl after settling below the level the previous day.
- **Gold Benefits from Dollar Pullback:**
Spot gold experienced marginal gains as the Dollar pulled back, although prices remained within the range observed the day before.
- **Copper Briefly Rises Amid Market Moves:**
Copper futures briefly ascended in tandem with gains in Chinese mainland stock markets, receiving additional support from a retreating Dollar at that time.
**Upcoming Economic Indicators and Corporate Earnings:**
Looking ahead, the economic calendar includes key indicators such as German GfK, UK Unemployment, EU/UK/US Flash PMIs, and an announcement from the National Bank of Hungary. Additionally, there will be significant earnings reports from companies like ASM International, Orange, Puma, Logitech, Novartis, Barclays, Microsoft, Alphabet, Visa, Coca-Cola, Texas Instruments, Verizon, and General Electric. These events are poised to influence market dynamics in the coming sessions.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team