_edited_edited.png)
Markets Update: Asia-Pacific markets were mostly lower on Tuesday, following the negative lead from Wall Street and amid ongoing U.S.-China tensions.
Today's important market events:
[EUR] German Ifo Business Climate Index (May) - 10:00 CEST
[GBP] BoE Gov Bailey Speaks - 11:30 CEST
[USD] Crude Oil Inventories - 16:30 CEST
[USD] ECB President Lagarde Speaks - 19:45 CEST
[USD] FOMC Meeting Minutes - 20:00 CEST
Global Markets Roundup: 24 May 2023
Asia-Pacific markets were mostly lower on Tuesday, following the negative lead from Wall Street and amid ongoing U.S.-China tensions.
The U.S. House China Select Committee Chair called for retaliation against China’s ban on Micron Technology. U.S. GOP Rep. McHenry said the top-line disagreement remains on spending and he cannot say when negotiations will resume.
European equity futures are indicative of a lower open, with the Euro Stoxx 50 down 0.4%. The U.S. dollar index (DXY) is a touch softer below the 103.50 mark, while the euro (EUR/USD) remains on a 1.07 handle. The New Zealand dollar (NZD) is lagging, following the Reserve Bank of New Zealand's (RBNZ) decision to raise the official cash rate (OCR) by 25 basis points (bps) as expected, but signaling the end of the hiking cycle with the peak rate forecast maintained at the current level.
Asia-Pacific markets were mixed on Tuesday, with investors cautious ahead of key economic data releases and central bank events.
The Australian market declined, with the resilience in the commodity-related sectors offset by weakness across the broader market. The Westpac Leading Index remained depressed.
The New Zealand market was underpinned after a dovish RBNZ rate hike which signaled the end of its rate increases.
The Japanese market was pressured after its recent pullback to beneath the 31,000 level. The first positive reading this year in the monthly Reuters Tankan manufacturing survey did little to spur risk appetite.
The Hong Kong and Shanghai markets were lower amid US-China frictions. The White House spoke out against the Micron ban, while a lawmaker called for the Commerce Department to add Changxin Memory Technologies to the entity list and ensure no US export licenses are granted to firms operating in China which are used to backfill Micron.
U.S. equity futures were contained after slipping yesterday due to the ongoing debt limit concerns.
European equity futures are indicative of a lower open with the Euro Stoxx 50 -0.4% after the cash market closed down by 1.0% yesterday.
The U.S. dollar index (DXY) held on to most of yesterday’s mild gains owing to the risk-off tone in equities albeit with the upside capped by the debt ceiling impasse and after mixed data releases, while the focus turns to the upcoming FOMC Minutes.
The euro (EUR/USD) languished beneath 1.0800 after it gave way to the firmer dollar and with the single currency not helped by the mixed PMI figures from the bloc including a deeper contraction in manufacturing activity.
The British pound (GBP/USD) was rangebound ahead of UK CPI data and after the prior day’s fluctuations in which it briefly dipped below the 1.2400 handle but then clawed back losses in the aftermath of the latest BoE commentary.
The Japanese yen (USD/JPY) was indecisive as price action remained centered around a 138.50 focal point.
The Australian dollar (AUD/USD) and New Zealand dollar (NZD/USD) declined with the RBNZ’s dovish rate hike and the U.S. dollar’s strength.
The Chinese yuan (USD/CNY) was slightly higher after the PBoC set the mid-point at 7.0560.
In fixed income, 10-year U.S. Treasury yields marginally extended gains amid the risk aversion and following a stellar 2-year auction.
German bund yields edged higher after reclaiming the 134.00 level despite further hawkish ECB rhetoric.
10-year Japanese government bond (JGB) yields lacked direction and failed to benefit from the BoJ’s presence in the market for JPY 1.7tln of JGBs on top of its fixed rate operations as reports also noted that Japan could issue bonds to fund childcare policies.
In commodities, crude oil futures were underpinned after bullish private sector inventories including the surprise draw in headline crude stockpiles and following recent warnings by Saudi's Energy Minister for oil speculators to 'watch out'.
Spot gold traded sideways amid a rangebound dollar and as the attention shifts to the FOMC Minutes.
Copper futures declined alongside the debt ceiling concerns and tested USD 8,000/ton to the downside.
Looking ahead, key economic data releases and central bank events include:
U.K. consumer price index (CPI)
German Ifo business climate index
U.S. Federal Open Market Committee (FOMC) minutes from the May meeting
Speeches from European Central Bank (ECB) President Christine Lagarde and Federal Reserve (Fed) Governor Christopher Waller
Supply data from Germany, the United Kingdom, and the United States
Investors will be closely watching these events for any signs of how central banks are responding to rising inflation and the impact of the war in Ukraine.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team
Comments