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Markets Update: Global Downturn Influences APAC Stocks
Economic Calendar
Global Markets Roundup: 19 Oct 2023
**Market Update - Thursday, October 19, 2023:**
Asia-Pacific (APAC) stocks experienced widespread declines, echoing the global trend of heightened selling pressure across international markets.
**US Earnings Report Mixed Signals:**
Post-market earnings in the United States presented a mixed picture. Netflix surged impressively by 12.8%, reflecting robust performance, while Tesla faced a dip of 4.2%, contributing to after-hours volatility.
**European Equities Set for a Lower Opening:**
European equity futures suggest a lower open, with the Euro Stoxx 50 future indicating a decline of 0.6%. This follows a 1.1% drop in the cash market during the previous trading session.
**Currency Markets Display Stability:**
In the currency markets, stability prevails. The Dollar Index (DXY) is contained within a narrow range above 106.50. The Australian Dollar (AUD) experienced downside pressure following the release of jobs data, while USD/JPY maintains focus on the 150 level.
**ASX 200 Faces Headwinds Amid Jobs Data and Sectoral Pressures:**
The ASX 200 encountered downward pressure, influenced by mixed jobs data and the underperformance of yield-sensitive sectors. The market contended with nuanced employment figures, contributing to a challenging landscape for certain segments.
**Nikkei 225 Registers Substantial Losses Despite Positive Trade Figures:**
The Nikkei 225 experienced significant losses, diverging from mostly favorable Japanese trade figures. Despite positive economic indicators, the market grappled with headwinds that led to pronounced declines.
**Hang Seng and Shanghai Comp. Mirror Downtrend:**
The Hang Seng and Shanghai Composite indices followed suit in adopting a downbeat sentiment. Among them, the Hong Kong benchmark bore the brunt of the negative trend. Weakness in Chinese tech stocks and challenges within the property industry weighed heavily on market dynamics. The ongoing debt concerns and the persistence of contraction in Chinese property prices contributed to the somber mood in the region.
**Foreign Exchange (FX):**
- The Dollar Index (DXY) paused after the previous day's haven bid, with market participants anticipating a series of upcoming speeches from the Federal Reserve, including Chair Powell's address at the Economic Club of New York. Recent remarks from Bowman and Williams underscored persistent inflation concerns, while Harker and Waller hinted at a likely pause in November.
- EUR/USD remained lackluster, residing on a 1.05 handle following recent dollar strength that eroded its position.
- GBP/USD lingered at the week's lows, having slid from the 1.2200 handle amid prevailing market conditions.
- USD/JPY exhibited indecision, maintaining proximity to the closely watched 150.00 level, despite mostly positive Japanese trade data.
- Antipodeans faced pressure amid risk-off conditions, exacerbated by mixed Australian jobs data. The headline Employment Change missed forecasts, and though the Unemployment Rate was lower than expected, it coincided with a surprise drop in the Participation Rate.
- The People's Bank of China (PBoC) set the USD/CNY mid-point at 7.1795, deviating from expectations at 7.3226 (previous 7.1795).
**Fixed Income:**
- 10-year UST futures extended recent declines as the US 10-year yield hit a fresh 16-year high. The flimsy price action followed a mixed 20-year auction.
- Bund futures remained subdued after retreating below the 128.00 level, now acting as resistance.
- 10-year JGB futures were on the back foot, mirroring losses in global counterparts. They failed to benefit from slightly improved demand at the enhanced liquidity auction for long-end JGBs.
**Commodities:**
- Crude oil futures traded flat, largely indifferent to the US easing some sanctions on Venezuela. Qatar set December-loading Al-Shaheen crude term prices around USD 3.25/bbl above Dubai quotes.
- The US relaxed some sanctions on Venezuela's oil, gas, and gold sectors. The US Treasury issued a 6-month license authorizing transactions in Venezuela's oil and gas sectors. A general license allowing dealings with Venezuela's mining Co. Minerven was also issued. Venezuelan President Maduro emphasized that all sanctions must be lifted.
- Spot gold traded sideways, with prices hovering near the USD 1950/oz level amid an uneventful dollar.
- Copper futures remained subdued amid broad risk aversion and concerns within the Chinese property sector.
**Upcoming Economic Indicators and Central Bank Commentary:**
Looking ahead, the economic calendar features key releases, including US Initial Jobless Claims (IJC), Philadelphia Fed data, Existing Home Sales, and the Leading Index. A roster of Federal Reserve speakers, including Powell, Jefferson, Goolsbee, Barr, Bostic, Harker, and Logan, is expected to provide insights into the central bank's perspective. Additionally, supply updates from France and Spain will be monitored closely.
**Earnings Reports to Influence Market Sentiment:**
Corporate earnings continue to shape market sentiment. Today's earnings reports include updates from Roche, Nestle, Pernod Ricard, Renault, L'Oréal, Philip Morris, and AT&T. Investors are closely watching these releases for indications of corporate performance and potential market impact.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team