Global Markets Roundup: 17 Apr 2024

Global markets experienced a mixed session in the Asia-Pacific region on Wednesday, marked by shifting sentiments as Federal Reserve Chair Jerome Powell's comments hinted at a reconsideration of U.S. rate cuts for the year. This adjustment in stance propelled Treasury yields to reach new five-month peaks, driving the dollar to ascend against its counterparts. Australian government bond yields rose to the highest levels of the year, reflecting market skepticism towards Reserve Bank of Australia's rate cut prospects.

In the equities realm, MSCI's broadest index of Asia-Pacific shares outside Japan rebounded by 0.2% after enduring a decline of over 4% across the past three sessions. Taiwanese shares notably outperformed, surging by 1%, while other markets displayed subdued performances. Conversely, Japan's Nikkei fell by 0.7%, reaching its lowest point in two months. China's blue chips experienced a marginal dip of 0.1%, while Hong Kong's Hang Seng index recorded a modest 0.1% uptick. The sentiments from Asia-Pacific were partially influenced by Wall Street's marginal downturn on Tuesday, albeit supported by resilient corporate earnings. In European pre-market the EURO STOXX 50 Index Futures trade flat. Treasury yields witnessed a retest of 5% for two-year bonds overnight, settling at 4.9828%, while 10-year yields remained near a five-month pinnacle at 4.6674%, reflecting diminished expectations of Federal Reserve intervention amidst recent inflationary trends. Powell's commentary underscored the Fed's cautious approach, emphasizing the need for sustained vigilance amid persistent inflation surprises over the past three months. Consequently, market projections for rate cuts have undergone a significant reduction, with expectations now aligning to less than two cuts for the year, a substantial departure from initial forecasts of six cuts. The anticipated timeline for the first cut has shifted to September, albeit with waning confidence.

In the realm of currencies, the dollar index DXY maintained strength near a 5-1/2-month high at 106.3, the yen USDJPY continued its downward trajectory, touching fresh 34-year lows against the dollar with minimal intervention from Tokyo, despite looming prospects of government action. The euro traded EURUSD at $1.0621 on Wednesday, not far from the low of $1.06013 it touched on Tuesday. In other major currencies, sterling GBPUSD was last at $1.2425, but remained close to the five-month low of $1.24055 it touched on Tuesday. The Australian dollar AUDUSD rose 0.16% to $0.6410 on the day, while, the New Zealand dollar saw a 0.4% uptick to $0.5902 following unexpectedly robust first-quarter inflation data, leading to a revised outlook with markets now anticipating a total easing of just 34 basis points this year, a significant reduction from previous estimations.

Commodity markets observed a decline in oil prices as demand anxieties outweighed geopolitical concerns in the Middle East. Brent futures slipped by 0.4% to $89.68 a barrel, with U.S. crude CL1! dropping 0.5% to $84.95 a barrel. Meanwhile, gold GC1! prices held firm at $2,384.29 per ounce, maintaining proximity to record highs. Three-month copper on the LME HG1! was 0.1% lower at $9,459.50 per metric ton, extending declines from Tuesday. The most-traded June copper contract on the SHFE HG1! fell 0.5% to 76,700 yuan ($10,594.22) per ton. LME aluminium ALI1! slid 0.2% to $2,557 a ton, zinc ZNC1! dropped 0.5% to $2,758.50, lead LEAD1! slid 0.3% to $2,142, tin FTIN1! lost 0.4% to $31,685, while nickel NICKEL1! rose 0.8% to $17,860. SHFE aluminium ALI1! declined 0.4% to 20,335 yuan a ton, nickel NICKEL1! dropped 0.6% to 135,380 yuan, and tin FTIN1! was down 1.2% to 253,340 yuan, while lead LEAD1! added 0.5% to 16,900 yuan and zinc ZNC1! climbed 0.2% to 22,510 yuan.

The most-active soybean contract CBOT ZS1! was unchanged at $11.45 a bushel. CBOT wheat ZW1! was also flat at $5.65 a bushel, while corn ZC1! fell 0.1% to $4.30-3/4 a bushel. May arabica coffee (KCK24) on Tuesday closed +2.25%, and May ICE robusta coffee (RMK24) closed +0.78%. July London cocoa C2! settled down 5.9%, to 8,348 pounds per MT after hitting a record high at 9,025 pounds earlier in the session.

Economic Calendar - Wednesday, April 17, 2024

• Data Releases:
  
• Supply chain updates from UK, Germany, and US
  
• UK: Consumer Price Index (CPI), Producer Price Index (PPI)
  
• Eurozone: Flash CPI estimate (F)
  
• US: Federal Reserve Beige Book
  
• Speeches:
  
• ECB: President Lagarde
  
• BoE: Governor Bailey
  

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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