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Markets Update: Global equity markets exhibited mixed performance on Thursday, as investors assessed the implications of the US presidential election and anticipated upcoming central bank policy decisions. While US markets rallied on hopes of increased fiscal spending, Asian markets displayed a more cautious approach. Concerns over rising bond yields and potential trade tensions tempered enthusiasm in the region.
Global Markets Roundup: 7 November 2024
FESX1! | Z1! | NI225 | NQ1! | ES1! | EURUSD | USDJPY | DXY | GOLD | CL1! | ZC1! | ZS1! HG1!
Asia-Pacific equity markets showed a varied performance on Thursday, with investors assessing the impact of a Donald Trump presidency and keeping an eye on upcoming monetary policy decisions by the U.S. Federal Reserve and other major central banks. Despite the possibility of a Republican sweep leading to substantial fiscal spending and pushing all three major U.S. stock indexes to new highs, Asia did not experience significant gains. The surge in U.S. Treasury yields due to concerns about increased deficits contributed to the dollar's largest one-day rally against major currencies in over two years on Wednesday. The euro faced additional downward pressure following the dismissal of German Finance Minister Christian Lindner by Chancellor Olaf Scholz, resulting in the collapse of the ruling three-party coalition. In Japan, the mixed sentiment in Asian markets was evident as the tech-heavy Nikkei 225 NI225 reversed its early gains to decline by 0.44% to 39,308.55, while the broader Topix TOPIX maintained a 0.88% increase.
Bond yields have risen, with the 10-year U.S. Treasury yield at 4.4236%, close to Wednesday's peak of 4.4790%, while Japanese government bond yields reached 1% for the first time in three months. This led to a positive impact on Japanese banks and insurers, but had a negative effect on tech companies and other growth stocks. In other markets, South Korea's Kospi decreased by 0.14%, Australia's XJO slipped by 0.24% due to weakness in gold stocks following a drop in gold prices against a stronger dollar. Chinese markets, which had declined on Wednesday due to concerns about higher tariffs under a potential Trump presidency, rebounded in the latest session. Hong Kong's Hang Seng increased by 0.49% and mainland blue chips added 0.14%. The week-long National People's Congress Standing Committee meeting in China is set to conclude on Friday, with market participants eager for any updates on stimulus measures. Chinese trade data released on Thursday revealed a significant growth in outbound shipments in October, as manufacturers hurried to send inventory to key export markets in anticipation of potential tariffs from the U.S. and the European Union.
On Thursday, U.S. stock futures remained relatively stable or slightly higher. While Pan-European STOXX 50 futures FESX1! declined by 0.04%, German DAX futures DAX1! increased by 0.1% after a 1.1% drop the previous day. German Chancellor Scholz is working to gain support from the opposition conservatives to pass the budget and enhance military spending, following disagreements with the Free Democrats party. The leader of the Conservatives, who are significantly ahead in the polls, is expected to provide a response during a news conference later in the day.
In the foreign exchange markets, the EURUSD, remained relatively stable at $1.0733 after experiencing its most significant single-day decline since March 2020 on Wednesday, dropping by 1.82%. The dollar index DXYÂ that measures the dollar against the euro and other major currencies, held steady at 105.04 after surging by 1.53% in the previous session, marking its largest increase since September 2022. The dollar weakened by 0.16% against the yen, reaching 154.36, following a 2% surge the day before. The Bank of England is expected to lower interest rates by 0.25% on Thursday, only the second cut since 2020. Investors are eagerly awaiting signals from the BoE regarding its future moves after the government's budget aimed at increasing inflation. The British pound, GBPUSD, increased by 0.28% to $1.2915 after a 1.24% decline on Wednesday. Sweden's Riksbank is also anticipated to reduce rates by half a point on Thursday, as most economists predict. Meanwhile, Norway's central bank is likely to maintain its current policy. Bitcoin, represented by BTCUSD, paused on Thursday, decreasing by 1% to $75,200 following its surge to a record high of $76,499.99 overnight. Trump is known for his active support of cryptocurrencies. EURUSDÂ | USDJPY | AUDUSD | DXY | NZDUSD
In commodities, despite a more than 3% drop on Wednesday, the price of Gold remained soft, slipping to $2,657.58, which was still close to its recent all-time high of $2,790.15. Similarly, Crude oil weakened due to the strength of the dollar on Wednesday but managed to recover some losses on Thursday. This recovery was driven by concerns about oil supply under a Trump presidency and a looming hurricane in the Gulf Coast. Brent crude oil futures BRN1! increased by 0.35% to $75.18 per barrel, while U.S. West Texas Intermediate (WTI) crude CL1! rose by 0.22% to $71.85. In soft commodities, Chicago corn futures maintained their upward trajectory on Thursday, following a nearly 2% increase in the previous session, buoyed by a surge in the stock market driven by Donald Trump's re-election as U.S. president. Wheat futures remained stable, while soybeans saw an increase due to robust soyoil prices. The primary corn contract on the Chicago Board of Trade ZC1! stayed steady at $4.26-1/4 per bushel at 0510 GMT, after a 1.9% climb on Wednesday. CBOT soybeans ZS1! rose by 0.5% to $10.08-1/2 per bushel, while wheat ZW1! remained unchanged at $5.73 per bushel. Both commodities recorded marginal gains on Wednesday. BRN1! | CL1! | GOLD | HG1! | KC1! | RC1! | CC1!
Looking forward refer to the economic calendar below to see the upcoming events scheduled for today and the rest of the week.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team