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Markets Update: Following a surge in tech stocks, Asian shares rebounded on Thursday as the dollar strengthened after a slight upside surprise in U.S. core inflation. Investors eagerly anticipated the European Central Bank's policy decision later today, with a rate cut appearing highly likely, but uncertainty remained about further moves.
Economic Calendar
Global Markets Roundup: 12 September 2024
NI225 | HSI | ES1! | FESX1! | USDJPY | EURUSD | DXY | USDCHF | WTI CL1! | GOLD | ZC1! | CC2! | NVDA
Following a surge in tech stocks on Wall Street, Asian shares rebounded on Thursday. Meanwhile, the dollar maintained its gains after a slight upside surprise in U.S. core inflation, diminishing expectations of a significant rate cut by the Federal Reserve next week. Investors are eagerly anticipating the European Central Bank's policy decision later today, with a rate cut appearing highly likely. However, the uncertainty lies in whether the ECB will make additional moves in both October and December.
Europe is poised for substantial gains ahead of the ECB event, as EUROSTOXX 50 futures FESX1! surged by 1.3% and FTSE futures Z1! rose by 1.1%. Nasdaq futures NQ1! also reversed course, currently up by 0.3%. The Asia-Pacific shares outside Japan, as represented by MSCI's comprehensive index (.MIAPJ0000PUS), surged by 1.5%. The Nikkei index NI225 also saw a significant increase of 3.3%, supported by a decline in the yen's value, which retreated from its peak of 140.71 per dollar in 2024. FESX1! Z1! NQ1! NI225
The discouraging core inflation data initially impacted Wall Street, but once again, tech stocks, particularly AI favorite Nvidia (NVDA), surged by 8%, fueled by reports that the U.S. government is contemplating allowing the company to export advanced chips to Saudi Arabia. Following this trend, tech-heavy markets in the region also saw gains, with Taiwan's TWSE:TAIEX rising by 2.8% and South Korea's KOSPI increasing by 1.7%. Conversely, China's stock markets remained subdued, while Hong Kong's Hang Seng index rose by 1.2%. KOSPIÂ NVDA
The dollar strengthened by 0.3% to reach 142.75 yen USDJPY. Earlier, it had faced pressure from hawkish remarks made by a senior Bank of Japan official advocating for a minimum rate increase of 1%. Recent U.S. data revealed a 0.28% increase in the core consumer price index (CPI) for August, surpassing the anticipated 0.2% rise. This development significantly reduced expectations for a 0.5% rate cut by the Federal Reserve next week, with the likelihood of such a move now standing at just 15%. In the forex market, the dollar was close to a four-week peak against the euro EURUSD, as the euro dipped to $1.1015, remaining near the previous day's low of $1.1002 - the lowest level since August 16th. EURUSD USDJPY
Short-term U.S. Treasury bonds experienced a decline in value during the night. The yield on two-year Treasuries (US2YT=RR) increased by 1 basis point to 3.66%, marking a 4 basis point rise overnight, whereas the 10-year yields US10Y stood at 3.6665%. As a result, the yield curve between the 2-year and 10-year bonds slightly flattened, with the margin staying just above zero at less than 1 basis point.
Oil prices continued to rise due to concerns about the potential impact of Hurricane Francine on U.S. WTI CL1! production, with Brent crude futures BRN1! increasing by 0.7% to $71.09 per barrel following a 2% gain the previous day. The commodity also received support at $68.69, marking its lowest level in nearly three years. Meanwhile, gold GOLD edged up by 0.2% to $2,517.89 per ounce, remaining close to its all-time high of $2,531.60.
In agricultural commodities, November robusta coffee RC2! increased by $111, or 2.3%, reaching $5,008 per metric ton. The price of December arabica coffee KC2! dipped by 0.2% to $2.4665 per lb. December New York cocoa CC2! experienced a significant rise of 6.3% to $7,728 per ton after a 2.7% drop on Tuesday. December London cocoa C2! ​rose by 122 pounds, or 2.3%, to 5,355 pounds per ton, recovering from a 4.7% decline on Tuesday. October raw sugar SB1! ​increased by 0.26 cent, while October white sugar SF1! rose by 2% to $529.10 per ton. The soybeans contract with the most activity on the Chicago Board of Trade (CBOT) ZS1! rose by 0.2% to $10.02-1/2 per bushel at 0407 GMT, while the corn contract ZC1! also saw a slight increase of 0.19% to $4.05-1/2 per bushel. Conversely, the wheat contract on the CBOT ZW1! declined by 0.13% to $5.78-1/2 per bushel. RC2! SF1! C2! CC2! KC2! ZC1! ZS1! ZW1!
Looking forward today, key events on the news and economic release calendar consist of the Swedish Consumer Price Index, Spanish Harmonized Index of Consumer Prices (Final), US Initial Jobless Claims, Producer Price Index (Final), European Central Bank Policy Announcement and Press Conference, Norges Bank Regional Network Report (Q3), International Energy Agency Oil Market Report, Supply Updates from Italy and the US, as well as earnings reports from Lennar, Adobe, and Kroger.
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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