08 APR 2024

The Trade Academy Team

07:55 CET - 3 min read

Monday Morning Coffee - Markets Update - 08 Apr 2024 - APAC Equities Tread Cautiously as Dollar Strengthens Amid US Jobs Report

Markets Update: Asian stocks edged higher on Monday as easing Middle East tensions and robust US jobs data lifted investor sentiment, though caution prevailed ahead of key economic reports and the Fed's stance on interest rates.

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Global Markets Roundup: 08 APR 2024

On Monday, Asian-Pacific stocks commenced the week with a sense of caution, while the dollar demonstrated strength as investors assessed the implications of the latest robust jobs report from the United States on the Federal Reserve's stance regarding interest rate cuts. The easing of tensions in the Middle East, marked by Israel's withdrawal of additional troops from southern Gaza, contributed to a nearly 2% decline in oil prices. Meanwhile, gold prices, which had reached record highs on Friday, retreated by 1% amidst sustained elevation in US Treasury yields.

The MSCI's broadest index of Asia-Pacific shares, excluding Japan, showed a modest uptick of 0.26%, while Japan's Nikkei NI225 index surged by 1%. China's mainland markets resumed trading following an extended holiday, with the blue-chip gauge dipping by 0.5%, juxtaposed against a 0.33% rise in Hong Kong's Hang Seng Index. The positive sentiment spilled over from Wall Street, where major indices closed higher on Friday in response to data indicating robust job growth and steady wage increases, signaling a resilient economy as the first quarter drew to a close. In European pre-market, Euro Stoxx 50 Futures FESX1! trade slightly opositive, hinting on a positive European session open.

Market dynamics now reflect a 49.1% probability of a Fed rate cut in June, as indicated by the CME FedWatch tool, with July emerging as the prospective starting point for anticipated monetary easing, albeit at a pace slightly slower than initially anticipated. Investor attention is firmly fixed on the forthcoming US Consumer Price Index (CPI) report, with expectations of a slowdown in core inflation for March. The evolving narrative surrounding US interest rates has propelled Treasury yields upwards, with the two-year Treasury yield hitting its highest level in almost four months.

In currency market, the dollar has strengthened, with the euro EURUSD and sterling GBPUSD both depreciating marginally against the greenback. The Japanese yen USDJPY also weakened slightly amid vigilance towards potential intervention by Japanese authorities. The dollar index DXY, which gauges the greenback against a basket of major currencies, maintained its position at 104.35.

In commodities trading, spot GOLD experienced a 0.5% decline, retreating from its record peak achieved the previous week. Similarly, both US crude and Brent crude prices registered declines of WTI CL1! 2.32% and 2.5%, respectively, on the day. The most-active corn contract on CBOT fell 0.2% at $4.33-1/4 a bushel, while soybeans rose 0.2% to $11.87-1/2 a bushel. Wheat fell 0.5% to $5.64-1/2 a bushel.

Looking ahead today, markets anticipate: Swiss Unemployment Rate (Mar), German Trade Balance (Feb)/Industrial Output (Feb), EZ Sentix Index (Apr).

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General news - Information source from multiple newswires.

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

The Trade Academy Team