Global Markets Roundup: 12 July 2024

The yen experienced volatility on Friday, oscillating between losses and gains ​as investors reacted to speculation that Tokyo had intervened to support the ​Japanese currency following a U.S. inflation report that came in cooler than ​expected. The yen's movements against the dollar and other major ​currencies captured market attention, even as Asian stocks appeared set for ​a weekly gain driven by increasing expectations of a rate cut from the Federal ​Reserve in September (FEDWATCH).

Speculation persists that Japanese authorities intervened in the currency ​market on Thursday, when the yen surged nearly 3% against the dollar ​following the U.S. inflation data release. The dollar finished Thursday's ​session with a 1.7% loss against the yen, marking its largest daily decline ​since May. Local media suggested that Tokyo conducted official buying to ​bolster the yen, which has been languishing at 38-year lows. However, ​authorities have not confirmed any intervention. The Nikkei reported that the ​Bank of Japan conducted rate checks with banks on the euro against the yen ​on Friday, citing multiple sources.

The MSCI's broadest index of Asia-Pacific shares outside Japan ​(.MIAPJ0000PUS) fell 0.3%, following a negative lead from Wall Street, as ​investors shifted focus to smaller companies after the U.S. inflation report. ​This shift impacted some Asian markets on Friday, with Japan's Nikkei ​(NI225) falling more than 2%, primarily due to declines in tech stocks. ​Conversely, Hong Kong's Hang Seng Index (HSI) rose 2%. Futures for the ​S&P 500 (ES1!) slipped 0.06%, while Nasdaq futures (NQ1!) declined 0.24%, ​and EUROSTOXX 50 futures (FESX1!) edged down 0.08%. Despite these ​fluctuations, Asian shares (.MIAPJ0000PUS) remained on track for a weekly ​gain of about 1.4%, buoyed by growing expectations of imminent U.S. rate ​cuts. These expectations were strengthened by Thursday's U.S. consumer ​price figures and Fed officials' increasing confidence that inflation is under ​control. Market pricing now indicates over a 90% chance of a Fed easing ​cycle beginning in September, up from just over 50% a month ago, according ​to the CME FedWatch tool.

Currency and Commodity Markets

In currency markets, sterling (GBPUSD) stabilized at $1.2912, near a one-​year high reached on Thursday, as comments from Bank of England ​policymakers and better-than-expected GDP data led traders to scale back ​expectations of an August rate cut in Britain. The euro gained 0.02% to ​$1.0868, while the U.S. dollar remained under pressure, languishing near a ​one-month low against a basket of currencies (DXY). The dollar last stood ​0.14% higher at 159.10 yen (USDJPY), after rising over 0.3% to an intraday ​high of 159.45 yen and dropping 0.7% to a low of 157.75 yen earlier on ​Friday. Similar choppy trading was seen in other yen pairs, although these ​fluctuations calmed throughout the day. The euro ended 0.16% higher ​against the yen (EURJPY), and the pound (GBPJPY) increased by 0.2%, both ​reversing initial losses.

In commodities and agricultural commodities, oil prices rose, bolstered by ​signs of strong summer demand and easing inflationary pressures in the ​United States. Brent futures (BRN1!) ticked up 0.18% to $85.55 per barrel, ​while U.S. West Texas Intermediate (WTI) crude (CL1!) increased 0.35% to ​$82.91 per barrel. Gold (GOLD) edged 0.3% lower to $2,407.50 an ounce. ​Three-month copper on the LME HG1! treaded 0.3% lower to $9,759.50 per ​metric ton. September London cocoa C2! ​​was trading 5.2% higher, to 7,032 ​pounds per ton.

Looking ahead today, markets anticipate, German Wholesale Prices, French ​Inflation Rate, India Industrial Production, US PPI and Core PPI, Michigan ​Consumer Sentiment Prel, Brazil Business Confidence.

You can view all markets data and charts here.

General news - Information source from multiple newswires.

The article and the data is for general information use only, not advice!

The Trade Academy Team

Rating: Mixed Outlook

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