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Markets Update: Disappointing economic data and mixed corporate earnings weighed on Asian markets, while Europe appears set for a cautious advance. Investors remain focused on economic indicators and earnings releases going forward.
Economic Calendar
Global Markets Roundup: 30 Jan 2024
Asian markets traded in a mixed session on Tuesday, with gains on Wall Street unable to fully offset weakness in China. The Nikkei 225 edged higher, buoyed by a weakening yen, while the Hang Seng and Shanghai Composite both ended marginally lower. In the US, the Treasury Department announced plans to borrow less than previously estimated in the first quarter of 2024. This news fueled hopes for easing pressure on interest rates, potentially providing a boost to risk assets. European equity futures, however, were cautiously optimistic, hinting at a slightly higher open for the continent. Euro Stoxx 50 future up 0.4% following a modest 0.1% gain for the cash market on Monday.
Australia: The ASX 200 edged higher despite headwinds from weak retail sales and lagging financials, finishing the day with limited gains. Japan: The Nikkei 225 saw an initial boost after Japan's unexpected drop in unemployment, but the rally fizzled and the index surrendered most of its gains. China: Hong Kong and Shanghai Composite faced selling pressure as earnings season intensified. Property and tech stocks led the decline in Hong Kong, further impacted by the start of the process for passing new national security laws by the Hong Kong government.
Major currencies stayed within narrow ranges on Tuesday, with participants holding their breath before a string of critical risk events later this week.
DXY: Holding Pattern
The US Dollar Index (DXY) remained contained between 103.36 and 103.52, as investors awaited clues from the Federal Open Market Committee (FOMC) meeting and Nonfarm Payrolls data due Wednesday.
EUR/USD: Sideways Drift
Euro-Dollar (EUR/USD) lacked direction after bouncing from a brief dip below 1.0800, with recent dovish European Central Bank (ECB) rhetoric keeping momentum subdued.
GBP/USD: On Hold
Sterling-Dollar (GBP/USD) mirrored the broader FX market's cautious stance, with the BoE meeting also on the horizon.
USD/JPY: Muted Advance
US Dollar-Yen (USD/JPY) edged higher from yesterday's lows, supported by softer US yields and Japan's falling unemployment rate.
AUD and NZD: Stalled Rally
Australian Dollar (AUD) and New Zealand Dollar (NZD) traded mixed, with their risk-driven gains from earlier in the week stalling due to weak Australian retail sales and losses in China.
Central Bank Talk
Swiss National Bank (SNB) Chair Jordan expressed optimism about inflation, expecting it to rise slightly but remain below 2% in 2024. His comments added to the dovish sentiment from central banks.
Fixed Income: Floating Await Decisions
US 10-year Treasury futures held steady ahead of the Treasury refunding announcement and the FOMC meeting. German Bund futures extended gains above 135.00, buoyed by recent ECB dovishness. Japanese 10-year JGB futures saw limited gains, capped by falling unemployment and mixed 2-year auction results.
Commodities: Rangebound Amid Geopolitical Tensions
Crude oil futures remained rangebound after failing to sustain initial advances. The threat of US retaliation for the attack on its troops in Jordan and a possible return of sanctions on Venezuela provided some support. However, Saudi Aramco's directive to maintain current production capped bullish sentiment. Spot gold lacked direction and copper futures retreated from their peak as investors cautiously positioned themselves for the upcoming FOMC meeting and NFP data. Copper futures retreated on Tuesday, relinquishing some of yesterday's gains as concerns about economic weakness in China overshadowed any lingering bullish sentiment. After briefly hitting a fresh high on Monday, the red metal encountered resistance and dipped below the key $8,500 per tonne level.
Data releases and events to watch out for today include:
Eurozone: Regional CPI figures, EZ-wide GDP, Swiss KOF Indicator
UK: Mortgage Lending, EZ Consumer Inflation Expectations
US: JOLTs Job Openings, Consumer Confidence, Japanese Retail Sales, BoJ Short-Term Operation Outcome
Comments: ECB's Lane, Nagel & SNB's Jordan
Debt issuance: UK, Italy & Germany
Earnings: Diageo, Entain, BBVA, UPS, Pfizer, Marathon Petroleum, Microsoft, Alphabet, Starbucks & AMD
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team