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Markets Update: Asian stock markets fell due to Nvidia's disappointing results, while the dollar stabilized and Treasury yields approached positive territory. Debt and currency markets remained relatively steady, and commodity prices saw mixed performances.
Economic Calendar
Global Markets Roundup: 29 August 2024
NI225 | HSI | ES1! | FESX1! | USDJPY | EURUSD | DXY | USDCHF | WTI CL1! | GOLD | ZC1! | CC2! | NVDA
Asian stock markets mirrored the negative trend of Wall Street futures on Thursday, driven by disappointing results from Nvidia, which raised concerns among optimistic investors. Meanwhile, the dollar stabilized and the Treasury yield curve approached a positive territory.
In Europe, the opening is anticipated to be mixed, with EUROSTOXX 50 futures FESX1! down 0.2% and FTSE futures Z1! up 0.2%. Inflation figures from Germany and Spain will be closely monitored for any adverse surprises that could bolster the argument for further monetary policy easing in Europe.
The MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) declined by 0.3%, with a notable decrease in tech stocks. The Nikkei NI225 slipped by 0.2%, while South Korea's KOSPI fell by 1%. Despite Nvidia's third-quarter revenue forecast of $32.5 billion exceeding Wall Street estimates, the results failed to meet the expectations of the most bullish investors, resulting in a nearly 7% drop in the company's shares during after-hours trading. Consequently, Nasdaq futures NQ1! declined by 0.7%, while S&P futures ES1! decreased by 0.3%.
Nvidia's chip supplier TSMC 2330 also experienced a decline of 1.8%, dragging down the broader Taiwanese market TWSE:TAIEX by 0.7%. Nvidia, in some respects, has become a victim of its own success, with its stock price soaring over 180% this year and surpassing earnings estimates in 14 of the last 15 quarters. China's blue-chip stocks 3399300 remained stable after three consecutive sessions of decline, reflecting disappointing performances from Chinese firms and concerns about the country's fragile economic recovery. UBS recently revised down its 2024 GDP growth forecast for China from 4.9% to 4.6%. Chinese battery manufacturer CATL 300750 dropped by 1.1% following a move by two top Republican lawmakers to include the company on a restricted list of firms allegedly cooperating with Beijing's military.
In the Asian session, debt and currency markets remained relatively steady. The dollar held above year-long lows, reflecting expectations of upcoming Fed rate cuts. Futures have fully priced in a quarter-point cut next month, with a 35% likelihood of a half-point reduction. The euro EURUSD traded at $1.1135, failing to breach major resistance at $1.12 after a 0.6% decline overnight.
U.S. Treasury yields were calm, with the two- and 10-year curve nearly approaching positive territory for the first time since July 2022, except for a brief inversion during the recent Japanese market turmoil. Two-year yields (US2YT=RR) held at 3.8712%, while 10-year yields US10Y stood at 3.8368%, just 3 basis points below the two-year rate.
Gold prices continued to climb, nearing another peak. GOLD rose by 0.6% to $2,517.73 per ounce, slightly below the record of $2,531.6. Oil prices rebounded after two consecutive days of decline, with worries about demand from China and the U.S. offsetting supply disruptions from Libya. Brent crude futures BRN1! rose by 0.2% to $78.83 per barrel, following a more than 3% drop in the past two days, while U.S. West Texas Intermediate crude CL1! increased by 0.3% to $74.77. The three-month aluminum contract ALI1 on the London Metal Exchange dropped by 2.4% to $2,489 per metric ton at 1605 GMT, marking the largest decrease since June 7. It had reached a peak of $2,554 on Tuesday, representing a 12% increase since the beginning of August. The soybean contract with the highest activity on the Chicago Board of Trade (CBOT) ZS1! increased by 0.3% to $9.79-3/4 per bushel, as of 0421 GMT, while corn ZC1! rose by 0.2% to $3.91-1/2 per bushel. Wheat ZW1! also saw a gain of 0.1% at $5.42-1/4 per bushel. October white sugar SF1! dropped by 0.6% to $544.70 per ton. November robusta coffee RC2! closed higher at $4,926 per ton, up $80 or 1.7%, reaching its highest level in at least 16 years on Tuesday at $4,952. December arabica coffee KC2! increased by 0.5% to $2.5645 per lb, coming close to the 2-1/2 year peak reached on Tuesday. December New York cocoa CC2! ​​settled at $7,741 per ton, down $84 or 1.1%.
Later in the day, the U.S. will release weekly jobless claims data, which has gained significance in light of the Federal Reserve's emphasis on the labor market.
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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