18 July 2024
The Trade Academy Team
07:30 CET - 3 min read
Thursday Morning Coffee - Markets Update - 18 July 2024 - Asian Equities Fall, Yen Surges, and Dollar Weakens
Markets Update: The Asian stock market saw a decline as trade tensions between the U.S. and China escalated, leading to a surge in the yen and a drop in chip stocks. The U.S. dollar remained weak, while gold prices stayed near record highs. These market movements are tied to U.S. political developments and expectations of a rate cut by the Federal Reserve in September. The future trends will likely be influenced by central bank policies and geopolitical decisions.
by TradingView
Global Markets Roundup: 18 July 2024
It's been a tumultuous time for Asian equities, as chip stocks led to a decline in the market on Thursday. The concern over escalating trade tensions between the U.S. and China has been weighing heavily on investor sentiment. Additionally, the yen has surged to a six-week high following suspected interventions by Tokyo last week. These market movements have sparked significant interest and concern among investors and analysts.
Asian Stock Markets Decline
Asian stock markets, including MSCI's Asia-Pacific shares and Japan's Nikkei NI225, experienced declines due to the yen's strength and a sharp drop in chip stocks, with China stocks 000001 and and blue-chip CSI300 index 3399300 also slipping as investors awaited policy news from a key leadership gathering in Beijing.
Impact of U.S. Politics on Global Markets
The impact of U.S. politics was evident across key markets, with divergences and broken correlations being observed. Investor nerves were also affected by comments from Republican presidential candidate Donald Trump, contributing to a broader uncertainty in global markets.
Currency Market Overview
The text provides an overview of the currency market, highlighting the struggle of the dollar against the euro EURUSD and sterling GBPUSD. It mentions the euro's stability near a four-month high and sterling's proximity to a one-year peak. The dollar index DXY is also discussed, indicating its position in comparison to six peers and insights from a Macquarie strategist.
European Central Bank Policy Decision
Investor attention is focused on the European Central Bank's policy decision, expecting the bank to maintain the status quo, with emphasis on officials' comments to determine future rate cut possibilities.
Yen's Performance and Trading Opportunities
The yen's performance, noting its six-week high against the dollar USDJPY and suspicions of Japanese authorities supporting the currency. It also discusses the impact of the wide interest rate difference between the U.S. and Japan, creating profitable trading opportunities through carry trade.
In Commodities and Soft Commodities
GOLD prices continue to show strength, hovering just below the record high at $2,483.60 it reached on Wednesday. This indicates a positive trend in the commodities market and suggests that investor interest in gold remains robust. Brent BRN1! futures edged 0.4% higher, to $85.40 a barrel, while U.S. West Texas Intermediate (WTI) crude CL1! climbed 0.6%, to $83.33. Corn ZC1! shed 0.5% to $4.09-3/4 a bushel. September arabica coffee KC2! traded 0.2% lower, to close at $2.4315 per lb. September New York cocoa CC1! lost 1% to $7,763 a ton.
Looking ahead today, markets anticipate the UK Unemployment Rate, EU Deposit Facility Rate, ECB Interest Rate Decision, US Initial Jobless Claims, and ECB Press Conference.
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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