Global Markets Roundup: 16 April 2024

The S&P 500 experienced its most significant two-day downturn in over a year, marking a 2.6% decline since Friday. This trend was mirrored in the Asia-Pacific (APAC) region, where stocks saw a downturn amid mounting concerns over potential imminent actions by Israel against Iran. Investor sentiment was further dampened by mixed economic indicators from China. While Chinese GDP for Q1 surpassed expectations, this positive news was offset by disappointing data on Industrial Production and Retail Sales. In Europe, equity futures suggested a negative start, with the Euro Stoxx 50 future indicating a 1.2% decrease following a modest 0.6% rise in the cash market on Monday. Currency markets saw the DXY strengthening to a 106 handle, with EUR/USD edging closer to the 106 mark, while currencies from commodity-dependent economies lagged behind.

APAC stocks witnessed widespread declines, driven by global geopolitical tensions and mixed economic signals from China. The ASX 200 saw retreat across all sectors, with consumer discretionary stocks leading the downturn. The Nikkei 225 was particularly hard-hit, slipping below the 38,500 level, shedding over 800 points. Both the Hang Seng and Shanghai Composite followed suit, despite the positive GDP figures from China being overshadowed by weak Industrial Production and Retail Sales data. Property sector concerns were further exacerbated by deteriorating home prices and the filing of a winding-up petition against developer Times China (1233 HK) by Hang Seng Bank. US equity futures remained subdued after Wall Street's recent losses, with the S&P 500 registering its worst two-day performance in over a year. European equity futures pointed to a negative opening, with the Euro Stoxx 50 future indicating a 1.2% decline following a modest gain in the cash market on Monday.

In the foreign exchange markets, the DXY reached a five-month high, buoyed by strong US Retail Sales data, while comments from Fed's Daly suggested no immediate need for rate cuts despite recent inflation figures. EUR/USD remained subdued, reflecting ongoing dovish sentiment from the ECB, while GBP/USD hit fresh year-to-date lows. USD/JPY traded at the 154.00 handle, benefiting from widened yield differentials following the US Retail Sales data. Antipodean currencies declined due to the prevailing risk-off sentiment, with CNH pressured by a weaker PBoC fix.

In the commodities market, crude futures were supported by geopolitical tensions surrounding potential actions by Israel against Iran. US oil output from shale-producing regions is set to increase marginally in May, reaching levels not seen since December 2023. However, the US announced it would not renew a temporary license easing sanctions on Venezuela's oil and gas sector unless progress is made by President Maduro. Spot gold maintained gains from the previous day, benefiting from safe-haven demand, while Citi expressed bullish sentiments, projecting gold prices to reach USD 3,000/oz over the next 6-18 months. Copper futures retraced from previous highs amidst risk aversion and mixed Chinese data.

Looking ahead, market participants are awaiting key economic indicators including the German Wholesale Price Index, ZEW, UK Jobs data, Canadian & NZ CPI figures, along with speeches from several central bank officials including Fed's Daly, Jefferson, Williams, Barkin, and Powell, as well as ECB’s Rehn, BoE’s Bailey, Lombardelli, and BoC's Macklem. Additionally, investors are eyeing earnings reports from companies such as LVMH, United Health, UAL, Bank of America, and Morgan Stanley, alongside updates on the IMF World Economic Outlook and Fed Discount Rate Minutes, as well as supply data from the Netherlands and the UK.

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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