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Writer's pictureThe Trade Academy Team

Tuesday Morning Coffee - Markets Update - 22 October 2024 - Global Markets React to US Election Uncertainty


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Markets Update: Investors sell Japan ahead of domestic election. Nikkei -1.4%, dollar/yen hits 151. China markets flat; Australia, S. Korea stocks down.

 

Global Markets Roundup: 22 October 2024


FESX1! | Z1! | NI225 | NQ1! | ES1! | EURUSD | USDJPY | DXY | GOLD | CL1! | ZC1! | ZS1! HG1!


On Tuesday, Asian stocks declined, while bond yields and the dollar reached multi-month highs and gold remained close to its peak, as investors prepared for the upcoming U.S. election. In Asia, the benchmark 10-year Treasury yields for US10Y rose by three basis points to 4.21%, marking the highest level since late July. U.S. ES1! and FTSE Z1! stock futures dropped by 0.2%, while European futures FESX1! increased by 0.1%. In Japan, investors withdrew some funds as the country approaches a general election on Sunday, causing stocks, bonds, and the yen to all decrease concurrently due to polls indicating the potential loss of the ruling coalition's majority. Japan's Nikkei index, also known as NI225, experienced a 1.4% decline in afternoon trading, reaching its lowest point since early October.


The MSCI's broadest index of Asia-Pacific shares, excluding Japan (.MIAPJ0000PUS), declined by 0.7%, as benchmark indexes in Australia XJO and South Korea KOSPI dropped by over 1%. China's markets remained significantly below recent peaks as traders awaited more details and, particularly, increased government urgency and spending to bolster the struggling economy. Hong Kong's Hang Seng HSI hovered around unchanged, while the Shanghai Composite 000001 edged up by 0.2%. Hyundai Motor India's (HYUN.NS) shares slid by 2% in a lackluster debut, as retail investors kept their distance.


In the currency markets, for the first time since July, the yen reached 151 per dollar, with bonds following the downward trend in U.S. Treasuries. Apart from the yen, foreign exchange markets stabilized after a period of widespread selling against the dollar. On Tuesday, the U.S. dollar DXY held onto a 2-1/2-month peak amid anticipations that the Federal Reserve will implement interest rate reductions cautiously. Simultaneously, the tight competition in the forthcoming U.S. election kept investors anxious. The Australian and New Zealand dollars both gained approximately 0.5% against the U.S. dollar, while the euro and sterling saw a 0.1% increase. This development pushed sterling back above $1.30 against the dollar, although traders remain cautious due to an upcoming speech by Bank of England Governor Andrew Bailey at 1325 GMT, during which he may hint at the central bank's potential for more aggressive interest rate cuts. EURUSD | USDJPY | AUDUSD | DXY | NZDUSD


Commodities continued to face downward pressure due to the anticipation of weak Chinese demand and dissatisfaction with the economic support measures unveiled for China. Iron ore prices dropped over 1% in Singapore (SZZFX4) to $100.70 per ton, while copper prices remained stable. Oil prices also stabilized, with Brent crude futures BRN1! trading at $73.96 per barrel in Asia. The International Energy Agency's chief mentioned on Monday that China's oil demand growth is expected to stay subdued until 2025. 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

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