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Markets Update: APAC Stocks Lose Steam; ASX 200 Lower on Commodities Slide, Nikkei Falters Despite Beat, Hang Seng and Shanghai Comp Weaken; European Futures Point Lower, Biden-Xi Summit Ends on Constructive Note.
Economic Calendar
Global Markets Roundup: 16 Nov 2023
Asia-Pacific stocks were mostly negative on Thursday, as the recent data-driven momentum eventually lost steam. The US Senate voted to pass the stopgap funding bill to avert a government shutdown, as expected. European equity futures are indicative of a slightly softer open, with the Euro Stoxx 50 down 0.1% after the cash market closed +0.6% yesterday. The Biden-Xi summit was said to be constructive and productive, with the leaders agreeing to restart cooperation on counter-narcotics and create forums for military-to-military contact. In FX, the DXY has continued to grind higher to around 104.50, USD/JPY remains on a 151 handle, and the AUD and NZD are lagging behind their peers.
The ASX 200 index fell on Thursday, with the energy and mining-related sectors pressured by a deterioration in the commodities complex. Stronger-than-expected employment data failed to spur risk appetite, as investors remained cautious ahead of key data releases and central bank speeches. The Nikkei 225 index failed to sustain its early gains despite better-than-expected exports and machinery orders. Sentiment was dampened by a mixed bag of tech earnings ahead of Alibaba's results. The Hang Seng and Shanghai Composite indexes weakened amid reports that US President Biden said Chinese President Xi was a dictator and raised concerns about human rights abuses. These comments overshadowed the positive rhetoric from the Biden-Xi meeting, which was said to be constructive and productive.
FX
The US Dollar Index (DXY) continued to claw back its post-CPI losses, sitting just below 104.50. The dollar's recovery was aided by better-than-expected retail sales and NY Fed manufacturing data, as well as the Senate's passage of a stopgap funding bill to avert a government shutdown.
EUR/USD marginally softened as the dollar regained some composure, trading within a 1.0831-55 range. GBP/USD dipped below the 1.2400 handle in an extension of its pullback following softer UK inflation. USD/JPY was steady after returning to the 151.00 territory alongside yesterday's rebound in US yields. The AUD and NZD were pressured amid the soured risk appetite and commodity weakness. The PBoC set USD/CNY mid-point at 7.1724 vs exp. 7.2474 (prev. 7.1752).
FIXED INCOME
10-year UST futures rebounded from yesterday's trough after being dragged lower by better-than-expected US retail sales and NY Fed survey data. Some slight overnight reprieve was seen as sentiment waned. Bund futures remained contained below the 131.00 level in the absence of any major pertinent catalysts. 10yr JGB futures were uneventful following better-than-expected data releases from Japan and slightly improved demand at the enhanced-liquidity auction for 2yr-20yr JGBs.
COMMODITIES
Crude oil futures extended their declines amid headwinds from the subdued risk tone and firmer dollar. Spot gold traded rangebound with the precious metal contained after the recent dollar rebound. Copper futures were subdued alongside the soured risk appetite in the major Asian bourses.
Key takeaways:
APAC stocks lose steam
European futures point lower
Biden-Xi summit ends on constructive note
DXY grinds higher to 104.50
USD/JPY remains on 151 handle
AUD and NZD lag peers
ASX 200 lower on commodities slide
Nikkei falters despite beat
Hang Seng and Shanghai Comp weaken
Energy and mining sectors pressured by commodities complex
Tech earnings mixed ahead of Alibaba's results
Biden-Xi meeting yields positive rhetoric but overshadowed by Biden's comments on Xi
EUR/USD marginally softens
GBP/USD dips below 1.2400
10-year UST futures rebound from yesterday's trough
Bund futures contained below 131.00
10yr JGB futures uneventful
Crude futures extend declines
Spot gold trades rangebound
Copper futures subdued
Looking ahead:
Highlights include US IJC, BoE's Ramsden, ECB's Lagarde & de Guindos, Fed's Barr, Waller, Cook, Mester & Williams, Supply from Spain, France & US, Earnings from Alibaba & Walmart
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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