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Markets Update: Asian stocks rallied on Fed rate cut hopes, then eased, while the dollar fell. Investors await key Fed events for monetary policy clues. The yen is watched post-BOJ policy shift. Gold nears a record high, oil declines, and commodities mixed. Focus now on European inflation and economic data.
Economic Calendar
Global Markets Roundup: 20 August 2024
Asian stocks confidently rose to a one-month high on Tuesday, driven by the positive momentum on Wall Street fueled by speculation about potential interest rate cuts by the Federal Reserve. With a relatively quiet week for major economic data releases, investors are eagerly awaiting insights from the release of the Fed's July meeting minutes on Wednesday and Chair Jerome Powell's upcoming speech at Jackson Hole on Friday regarding the future path of U.S. interest rates. The MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) reached a one-month peak before slightly easing, ultimately trading 0.4% higher.
Japan's Nikkei NI225 surged by 1.7%, led by a rally in technology stocks despite the yen's recent strength. Recent comments from Fed officials have suggested a potential easing in September. In early Asian trading, U.S. stock futures showed minimal movement, with S&P 500 futures ES1! down 0.02% and Nasdaq futures NQ1! up 0.04%. EUROSTOXX 50 futures FESX1! remained stable, while FTSE futures Z1! declined by 0.36%. China's key lending rates stayed unchanged as anticipated, resulting in a subdued market reaction.
The expectation of a dovish Fed stance this week has kept the dollar close to a seven-month low against the euro EURUSD, which rose to $1.108775 on Tuesday. Sterling GBPUSD hovered near a one-month high, trading at $1.2985. The dollar slipped in early Tuesday trading to its lowest level in over seven months against a basket of currencies DXY, at 101.76. Against the yen USDJPY, the dollar dropped by 0.23% to 146.26.
Traders will closely monitor Bank of Japan (BOJ) Governor Kazuo Ueda's appearance in parliament on Friday, focusing on discussions about the central bank's decision last month to raise interest rates. The BOJ's shift to a hawkish stance had previously caused significant market volatility as investors unwound yen-funded carry trades aggressively, impacting global stocks. Recent market turbulence has calmed down following comments from BOJ deputy governor Shinichi Uchida downplaying the likelihood of further rate hikes in the near term.
Gold prices remained above the $2,500 mark, nearing a record high. Oil prices eased due to reduced concerns about supply disruptions in the Middle East, with Brent crude BRN1! down 0.15% at $77.54 per barrel. U.S. crude CL1! declined by 0.5% to $74 per barrel. The most active soybean contract on the Chicago Board of Trade (CBOT) ZS1! rose by 0.2% to $9.77-3/4 a bushel, while CBOT corn ZC1! increased by 0.1% to $4.00-1/2 a bushel, and wheat ZW1! dipped 0.1% to $5.51-1/2 a bushel. November robusta coffee RC2! rose by 0.7% to $4,476 per metric ton after hitting a four-week high of $4,535. December London cocoa C2! increased by 1.5% to 5,466 pounds per ton. October raw sugar SB1! remained steady at 18.02 cents per pound.
Looking forward, today markets are eagerly awaiting the German PPI YoY, EU Inflation Rate YoY, Canada Inflation Rate YoY, and South Korea Business Confidence.
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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