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14 Mar 2024

The Trade Academy Team

08:00 CET - 3 min read

Thursday Morning Coffee - Markets Update -14 Mar 2024 - APAC Equities Stalled Near Highs: Investors Eye Central Bank Policy Cues

Markets Update: Market participants increasingly priced in the likelihood of a policy shift in March, particularly following reports of significant pay raises during Japan's annual wage negotiations. A preliminary survey on major firms' wage negotiations, scheduled for Friday, is expected to provide further insights. BOJ policymakers have emphasized the importance of these negotiations in determining the timing of the central bank's stimulus exit.


by TradingView

Global Markets Roundup: 14 March 2024

APAC equities maintained their position near seven-month highs on Thursday, exhibiting mostly sideways movement as investors awaited pivotal developments that could provide clarity regarding t'he global interest rate easing cycle.

The Nikkei NI225 in Japan was on track for its fourth consecutive day of decline, marking its lengthiest losing streak in approximately five months, amidst growing anticipation surrounding a potential policy shift from the Bank of Japan (BOJ) at its forthcoming meeting next week. The Nikkei NI225 index eased by 0.2%, remaining under pressure amidst ongoing market speculation. Meanwhile, MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) remained largely unchanged, hovering close to a seven-month peak established in the previous session. This stability occurred despite traders downplaying higher-than-anticipated U.S. inflation rate data. In China, the blue-chip CSI300 Index 3399300 rose by 0.46%, while the Shanghai Composite Index 000001 recorded a 0.25% uptick. Both indices reversed losses from the previous session, disregarding news of a Washington-based global trade association's intention to "separate" from its Chinese member, Wuxi AppTec <603259.SS>. However, Hong Kong's Hang Seng Index HSI experienced a slight decline of 0.1%, primarily driven by a 0.9% drop in technology stocks represented by HHSTECH. In Europe markets are trading sligtly in negative in the pre-market, with the EURO STOXX 50 Futures pointing to lower open trading at 5001 (-0.06%)

Economists at Wells Fargo noted in a client brief that since the Federal Open Market Committee (FOMC) last convened, U.S. inflation data have exhibited more strength than initially anticipated, while the labor market has remained resilient. They further speculated that the FOMC would likely seek greater confidence regarding the trajectory of inflation before making any definitive decisions.

In currency markets, despite the string of positive U.S. economic data, the trajectory of the dollar DXY which measures the greenback against a basket of six currencies, was last up 0.1% at 102.85. Sterling GBPUSD was little changed at $1.2792. The euro EURUSD remained close to its recent two-month high, trading at $1.0949. Similarly, the Australian AUDUSD and New Zealand dollars NZDUSD saw modest gains of 0.12% and 0.26% respectively, buoyed by increases in commodity prices. The USDJPY currency pair experienced a marginal increase to 147.71 per U.S. dollar, while the 10-year Japanese government bond (JGB) yield rose by 2.5 basis points to 0.78%.

In the commodities market, Brent BRN1! climbed by eight cents to $84.11 per barrel, while U.S. crude CL1! gained seven cents, reaching $79.79 per barrel. Spot gold GOLD saw minimal movement, holding steady at $2,174.69 per ounce. In the early hours of Copper demonstrated a notable uptick in value during Asian trading, building upon its overnight momentum. The three-month London Metal Exchange (LME) copper contract experienced a modest surge of 0.3%, now standing at $8,954.00 per ton.

Soft Commodities Market Report

Soft commodities witnessed mixed movements with notable fluctuations across various futures contracts. May arabica coffee (KCK24) concluded the day with a downturn of -3.25 (-1.75%), while ICE robusta coffee (RMK24) registered a decrease of -47 (-1.42%). .

The cocoa market, both in London and New York, soared to unprecedented levels driven by persistent concerns over dwindling West African supplies. May New York cocoa (CC2!) settled at $7,035 pounds per metric ton, after touching a record peak of $7,221.

In a separate development impacting the ZW1! wheat market, Chinese importers have reportedly cancelled or deferred approximately one million metric tons of Australian wheat imports. This decision comes against the backdrop of burgeoning global stockpiles, which continue to exert downward pressure on prices. The soft commodities landscape remains dynamic, with market participants closely monitoring supply trends and international trade dynamics for further insights into future price movements.

Later today, Core PPI , Initial Jobless Claims, and the US retail sales figures for February are also set to be unveiled, setting the stage for the Federal Reserve's policy meeting next week. During this meeting, attention will be directed towards any indications regarding the potential commencement of the rate-easing cycle by policymakers.

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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