15 APR 2024

The Trade Academy Team

08:15 CET - 3 min read

Monday Morning Coffee - Markets Update - 15 Apr 2024 - APAC Stocks Decline, Gold Surges Amid Middle East Tensions

Markets Update: Asian markets tumbled on Monday as escalating tensions in the Middle East triggered a flight to safety, with gold surging and the US dollar strengthening against most currencies, while oil prices remained stable despite initial expectations.

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Global Markets Roundup: 15 APR 2024

Asian-Pacific (APAC) markets faced a notable downturn on Monday, with gold prices experiencing an upsurge, as escalating tensions in the Middle East triggered a flight to safety among investors. Amid cautious sentiment, Asian markets opened the week on a somber note. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) registered a 0.7% decline following Iran's retaliatory strike on Israel late Saturday. Iran's use of explosive drones and missiles marked its first direct attack on Israeli territory since the conflict intensified. The specter of a broader regional conflict involving the United States loomed large, prompting apprehension across the region. U.S. President Joe Biden cautioned Israeli Prime Minister Benjamin Netanyahu against U.S. involvement in a retaliatory campaign against Iran, with Israel affirming that "the campaign is not over yet."

The Nikkei 225 in Japan plummeted over 1%, while Australia's S&P/ASX 200 index dropped by 0.6%. Hong Kong's Hang Seng Index experienced an 0.8% decline. The heightened geopolitical tensions spurred a rush to safety, propelling gold prices up by 0.51% to reach $2,356.39 per ounce. Meanwhile, U.S. stock futures showed a modest uptick following a substantial sell-off on Wall Street last Friday, which was triggered by underwhelming earnings results from major U.S. banks. S&P 500 futures (ES1!) and Nasdaq futures (NQ1!) each rose by 0.15%. In European pre-market the EURO STOXX 50 Index Futures FESX1! trade slighly postive at 4919.

In currencies, the safe-haven status of the U.S. dollar was reaffirmed, leading to a broad-based increase in the dollar index (DXY), which extended its 1.6% gain from the previous week. The U.S. dollar surged to a fresh 34-year high against the Japanese yen (USDJPY), fueled by mounting speculations that persistent inflationary pressures in the United States would lead to prolonged elevated interest rates. The EURUSD and GBPUSD trade near their respective five-month lows.

In commodities, contrary to expectations, oil prices remained relatively stable in the face of geopolitical turmoil, as markets had largely factored in the possibility of a retaliatory strike by Iran. Brent crude futures (BRN1!) hovered around $90.01 per barrel, while U.S. West Texas Intermediate (WTI) crude futures (CL1!) dipped approximately 0.6% to $85.13 per barrel. The escalating Middle East tensions sparked a flight to safety that pushed gold GOLD higher to $2,356.39 an ounce. The most-active wheat contract on the CBOT ZW1! traded 1% lower at $5.50-1/4 a bushel, while CBOT soybeans ZS1! traded 0.1% down to $11.72-3/4 a bushel and corn ZC1! fell 0.2% to $4.34-1/2 a bushel.

Looking ahead:

Economic Calendar - Monday, April 15, 2024

• US: Retail Sales (key data release)
  
• Europe: ZEW Economic Sentiment Surveys (Germany)
  
• Central Banks: Speeches by Fed's Logan, BoE's Breeden & ECB's Lane
  
• Earnings: Goldman Sachs & Charles Schwab
  

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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