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02 Apr 2024

The Trade Academy Team

08:01 CET - 3 min read

Tuesday Morning Coffee - Markets Update - 02 Apr 2024 - APAC Equities Ascend, Dollar Strengthens Amid Diminishing Odds of US Rate Cuts

Markets Update: APAC stocks rose on Tuesday despite a stronger dollar as positive US manufacturing data and potential delay in Fed rate cuts boosted investor sentiment.


by TradingView

Global Markets Roundup: 02 April 2024

On Tuesday, APAC equities experienced a surge while the dollar displayed strength, with the yen hovering around the 152-per-dollar threshold, prompting concerns over potential intervention. This shift came as expectations of imminent interest rate cuts by the Federal Reserve diminished. The latest data unveiled on Monday revealed a notable uptick in U.S. manufacturing, marking the first growth in 1-1/2 years during March. This surge in production and surge in new orders underscored the resilience of the economy, casting doubts on the necessity and timing of Fed rate adjustments. The robust manufacturing figures prompted an increase in yields on U.S. Treasuries, with two-year and 10-year yields reaching two-week highs, consequently bolstering the dollar.

Futures indicated a subdued opening for European stock markets, with EuroStoxx 50 futures up by 0.05%, German DAX futures by 0.02%, and FTSE futures by 0.07%. Japan's Nikkei experienced volatility, briefly surpassing the 40,000-point mark before leveling off just below it. In the broader Asia-Pacific region, shares outside Japan surged by 0.65%, primarily led by gains in Hong Kong stocks, where the Hang Seng Index climbed more than 2% after the financial hub reopened following public holidays. However, Chinese stocks experienced a slight downturn on Tuesday after registering their largest daily gain in a month on Monday, influenced by indications of a strengthening economic recovery. In the U.S., the S&P 500 commenced the first session of the second quarter on a subdued note, influenced by uncertainties surrounding the timing of interest rate adjustments following robust manufacturing data.

In currency market, the yen weakened slightly against the dollar, with USDJPY trading at 151.76 per dollar, not far from its 34-year low, with market participants closely monitoring any signs of intervention from Japanese authorities. The dollar (DXY) maintained its strength against major currencies, with the EURUSD and GBPUSD edging lower.

In commodities, U.S. crude and Brent prices experienced modest gains amid signs of improved demand and escalating tensions in the Middle East, and WTI crude futures for May rose 41 cents to $84.12 a barrel. Spot gold also saw an increase, reaching $2,256.46 an ounce after hitting an all-time high of $2,265.49 on Monday. Copper prices showed resilience as trading resumed on the London Metal Exchange (LME) and the Shanghai Futures Exchange following a prolonged weekend coupled with the Easter holiday. The three-month copper futures on the LME HG1!, saw an increase of 0.9%, reaching $8,947.50 per metric ton as of 0533 GMT. Meanwhile, the May copper contract, the most actively traded on the Shanghai Futures Exchange HG1!, witnessed a 0.3% uptick, settling at 73,040 yuan ($10,095.93) per ton. The most-active wheat contract on the CBOT ZW1! was up 0.3% at $5.58-1/2 a bushel by 0335 GMT, but prices are still down 11% this year and fell to $5.24 last month, the lowest since August 2020. July New York cocoa CC2! ​​settled up $308, or 3.3%, to $9,614 a metric ton after hitting a record high of $9,806. May arabica coffee KC1! settled up 2.95 cents, or 1.6%, at $1.918 per lb​​.

Looking ahead, economic calendar highlights include:

  • RBA Meeting Minutes released (released overnight)
  • Judo Bank Final Manufacturing PMI (released overnight)
  • Germany: Regional and National CPI data
    • Supply data from Germany
  • Eurozone: Final Manufacturing PMI
  • United Kingdom: Final Manufacturing PMI
  • United States: Durable Goods Orders
    • JOLTS Job Openings
    • Treasury auctions for various bills
    • Speeches from several Fed officials (Bowman, Williams, Mester, Daly)

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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