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- Varchev Finance: Trading day in one post 16.05.2018
Varchev Finance: Trading day in one post 16.05.2018
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Loading...Asian stock market: Stocks in Asia traded mixed on Wednesday following a down day for Wall Street as the U.S. 10-year Treasury yield rose to 3.09 percent overnight. Japan's Nikkei 225 eased 0.31 percent and the broader Topix slipped 0.11 percent as mining and oil shares weighed. Banking stocks also pulled back in early morning trade. Elsewhere, South Korea's benchmark Kospi pared steeper losses earlier in the morning to hover just above the flat line. Greater China markets were in negative territory: Hong Kong's Hang Seng Index 0.97 percent, extending losses seen in the last session. On the mainland, the Shanghai composite slipped 0.55 percent and the Shenzhen composite edged down by 0.39 percent. Over in Australia, the S&P/ASX 200 clung to gains and edged up by 0.46 percent. The country's heavily weighted "Big Four" banks carved out moderate gains while the energy sector led gains.
FX market: Sterling pared losses after U.K. jobs data showed basic wage growth accelerated in the three months to March and the jobless rate stayed at a 43-year low. This will help strengthen faith in an August rate hike, with markets now pricing more than 50% odds versus ~47% yesterday. It’s perhaps unsurprising the jobs market looks resilient. As Bloomberg Intelligence economists pointed out, when faced with a slowdown in demand, U.K. companies tend to adjust how they use resources rather than immediately cutting the workforce if they believe the slowdown is a blip. Treasury yields and the dollar have been steadily rising in concert over the past month-and-a-half. That’s a break from the brunt of the first quarter of 2018, when the two mostly moved inversely, correlation analysis shows. Relatively solid U.S. economic data, and a Federal Reserve that appears to be on track to tighten policy more quickly than its peers, are among factors favoring higher yields and a stronger dollar.
Commodities market: Gold bears had their way Tuesday as a stronger U.S. dollar and rising Treasury yields sapped demand for the metal and pushed it below key technical levels. After falling under its 200-day moving average, bullion extended losses to breach $1,300 an ounce for the first time since December. “June gold bears have gained the overall near-term technical advantage,” Jim Wyckoff, senior analyst at Kitco Metals Inc., said in a note to clients. The dollar “has been a significantly bearish force working against the precious metals bulls.”
European stock market: Investors will start cautiously today's trading session, as sentiment in the US has sharply changed this week. The German DAX and the French CAC will open without change, while UKX has 14 points gain. Traders will focus on CPI data in Germany and Europe, and may have a direct impact on intraday performance of indices.
U.S. stock market: U.S. stocks dropped sharply on Tuesday after Home Depot reported quarterly sales that fell short of Wall Street's expectations and interest rates breached new highs. The Dow Jones industrial average fell 193 points to close at 24,706.41, with Home Depot among the biggest contributors of losses. The index also snapped an eight-day winning streak. The S&P 500 declined 0.7 percent to 2,711.45 as health care and real estate stocks lagged. The Nasdaq composite dropped 0.8 percent to 7,351.63 as Amazon, Microsoft and Google-parent Alphabet all pulled back more than 1 percent. Today's expectations are for a negative session, as bond yields have risen to levels most recently seen in 2011. This raises interest rates, and coupled with the fact that the Fed will continue its aggressive approach to monetary policy, it does not bode well for the stock.
Economic calendar for the European and U.S. trading sessions:
09:00 Germany - CPI
12:00 Europe - CPI
15:00 Europe - ECB's Draghi Speaks
15:30 USA - Building Permits
16:15 USA - Industrial Production
17:30 USA - Crude Oil Inventories
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