Global Markets Roundup: 14 Feb 2024

APAC Sell-off: Asian stocks declined amid concerns that higher-than-expected US inflation will force the Fed to maintain its hawkish stance, delaying potential rate cuts. European Futures Point Lower: European equity futures indicate a further dip for the Euro Stoxx 50 after Tuesday's 1.2% decline. Dollar Holds Gains: The DXY maintained its post-CPI gains but stalled shy of 105, as Japanese officials issued verbal warnings against excessive JPY weakness. Japan Eyes Intervention: Japanese MOF official Kanda reiterated their readiness to intervene in the FX market "anytime, 24 hours, all year round" to defend the yen.

Australian Shares Lead Decline: The ASX 200 index fell on Wednesday, weighed down by the financial sector after Australia's largest lender, Commonwealth Bank (CBA), reported a drop in half-year profit and warned of potential financial strain due to rising interest rates in 2024. The top-weighted sector underperformed, dragging the broader index down. Nikkei Retreats on Mixed Earnings: Japan's Nikkei 225 index also retreated, with individual stocks reacting to their respective earnings reports. The biggest movers were influenced by company results, highlighting the selective nature of the decline. However, the recent weakness in the Japanese yen helped to partially cushion the index's losses. Hang Seng Echoes Risk-Off Sentiment: Hong Kong's Hang Seng index mirrored the risk-averse mood prevalent across Asia. Returning from a holiday closure and coinciding with the shutdowns of mainland Chinese markets, the Hang Seng displayed a similar downward trend.

FX:

• The US Dollar Index (DXY) holds onto gains after Tuesday's strong CPI data, but stalls near 105.00 resistance.
  
• EUR/USD finds temporary relief after hitting 1.0700, awaiting UK CPI data.
  
• GBP/USD steadies around 1.2600 ahead of UK data.
  
• USD/JPY retreats slightly from year-to-date high above 150.00, but Japanese officials reiterate readiness to intervene.
  
• AUD and NZD inch higher in quiet trading.
  

Fixed Income:

• US 10-year Treasury futures struggle below 110.00 as hotter inflation pushes yields to new highs.
  
• German Bund futures stay depressed below 133.00 ahead of a 30-year auction.
  
• Japanese 10-year JGBs track global losses, 10-year yield surpasses 0.75% after world's first sovereign GX climate bond auction.
  

Commodities:

• Crude oil futures rangebound on downbeat sentiment and mixed inventory data.
  
• Spot gold stuck at lows near $2,000/oz after US inflation data.
  
• Copper futures under pressure from dollar strength and diminished Fed rate cut hopes.
  
• Arabica Coffee: Prices edged lower today, falling slightly from earlier gains. Concerns over a potential surplus in major producing countries like Brazil are putting downward pressure on the market. Currently, Arabica futures are trading around $2.09 per pound, down 0.2% from yesterday's close.
  
• Cocoa: Prices experienced moderate volatility today, ultimately closing slightly higher. Ongoing concerns about potential supply disruptions in West Africa, a major cocoa producer, are countered by expectations of a healthy global harvest. Cocoa futures are currently trading around $2,520 per tonne, up 0.4% from yesterday's close.
  
• Corn: Prices were relatively flat today, hovering around $7.40 per bushel. While concerns about global energy costs and potential impact on fertilizer availability remain, ample global corn supplies are keeping a lid on prices.
  
• Wheat: Prices continue to trend upward, supported by concerns about tight global supplies and ongoing geopolitical tensions in Eastern Europe. Wheat futures are currently trading around $9.20 per bushel, up 0.8% from yesterday's close.
  

Data Watch: Key economic data releases to day include UK CPI/PPI, EZ Employment, Industrial Production, GDP estimate, US PPI revisions, Japanese GDP, and comments from central bank officials across Europe and the US.

Looking Ahead:

The market remains focused on upcoming economic data and central bank commentary, seeking clues about the future trajectory of monetary policy. With inflation concerns lingering, investors are preparing for a potentially choppy market environment in the near term.

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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