Tag: global stocks

Stocks advance, US yields dip as earnings season picks up

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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A gauge of global stocks rose on Tuesday to reach its highest level since early February as U.S. earnings season picks up steam, while Treasury yields dipped after three straight sessions of gains.

On Wall Street, the S&P 500 was roughly unchanged, but the Dow Industrials were weighed down by a 1.95 percent drop in Goldman Sachs after its quarterly results as well as a 2.31 percent decline in fellow Dow component Johnson & Johnson despite boosting its profit forecast.

Goldman peer Bank of America also lost ground even after its earnings beat estimates and was last off 1.17 percent.

“We are back to being driven by the realities that companies face and then how well they are doing facing those realities, and this is why we call earnings season ‘winners and losers’ season,” said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh.

Also Read: US stocks edge higher following report of cooling inflation

“Now you actually have to think about what is in your portfolio and take action accordingly because it is kind of a crazy mix.”

The Dow Jones Industrial Average fell 141.41 points, or 0.42 percent, to 33,845.77; the S&P 500 lost 6 points, or 0.14 percent, to 4,145.32; and the Nasdaq Composite dropped 13.93 points, or 0.11 percent, to 12,143.80.

European shares advanced, in part due to solid economic data from China, but were off earlier levels that sent it to its highest since February 16, 2022.

The pan-European STOXX 600 index rose 0.33 percent and MSCI’s gauge of stocks across the globe gained 0.10 percent. MSCI’s index had earlier reached its highest level since February 3.

Investors have turned their focus to corporate earnings as the market has largely priced in a 25 basis points rate hike from the Federal Reserve at its May meeting, according to CME’s FedWatch Tool.

St. Louis Federal Reserve President James Bullard said on Tuesday in an interview with Reuters that the Fed should continue hiking interest rates as recent data has shown persistent inflation in an economy that is likely to continue to grow.

U.S. Treasury yields dipped, with the benchmark 10-year falling for the first time after three straight sessions of gains, as investors weighed whether the Fed would pause its rate hike cycle after the May meeting.

The yield on 10-year Treasury notes was down 3.5 basis points to 3.557 percent while the two-year U.S. Treasury yield, which typically moves in step with rate expectations, was down 2.1 basis points at 4.167 percent.

The dollar was weaker against most major currencies after the data from China, while the pound strengthened against he greenback thanks to pay growth data in Britain boosting expectations the Bank of England will raise rates in May.

The dollar index fell 0.353 percent, with the euro up 0.35 percent to $1.0964.

The Japanese yen strengthened 0.43 percent versus the greenback at 133.90 per dollar, while Sterling was last trading at $1.2427, up 0.43 percent on the day.

Oil prices were little changed, as investors weighed the upbeat China data with concerns that rising rates could dent the growth outlook and sap demand.

U.S. crude recently fell 0.07 percent to $80.77 per barrel and Brent was at $84.63, down 0.15 percent on the day.

Also Read: Asian stocks trade mixed before key economic data from China

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Global stocks soar after US jobs data pare rate bets

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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World stocks rallied on Friday, led by Wall Street, as investors cheered a crucial U.S. jobs report that showed wage growth slowed in December, fuelling bets that inflation is easing and the Federal Reserve need not be as aggressive as some feared.

The MSCI All-World index jumped 1.3 percent. On Wall Street, the S&P 500 .SPX climbed 1.5 percent, the Dow Jones Industrial Average leapt 1.6 percent and the Nasdaq Composite rose 1.3 percent.

Data released early on Friday showed the U.S. economy added jobs at a solid clip in December, pushing the unemployment rate back to a pre-pandemic low of 3.5 percent as the labor market remains tight, while average hourly earnings rose 4.6 percent in December from a year earlier, down from 4.8 percent in November.

Also read: US hiring stays brisk as employers add 223,000 jobs

But some analysts cautioned against investors’ bets that the latest jobs report might tamper a hawkish Fed since the data pointed to a still-robust labor market.

“Everything else about this shows a very, very resilient labor market which doesn’t bode well for a smaller rate hike,” said Randy Frederick, managing director of trading and derivatives at Charles Schwab in Austin, Texas, referring to the jobs data.

“The odds have been relatively low that we would get a half a point (of rate hike) on Feb. 1, but those odds are going up every day based on all this data.”

Still, investors focused on the good news in the jobs data, and wagered the Fed might not need to raise interest rates by an aggressive 50 basis points at its next policy meeting in February.

Also read: India’s GDP may grow 7% in FY23: First advance estimates

The dollar index, which measures the greenback against six counterparts including the yen and euro, fell 0.8percent to 104.29, weighed by tampered rate expectations.

U.S. two-year Treasury yields, which track interest rate expectations, receded to 4.2682 percent, spiked to a more than two-month high of 4.497 percent overnight before easing to 4.4571 percent during European morning trading. The 10-year yield, which rose as high as 3.784 percent in New York on Thursday, also pulled back sharply to 3.5728 percent.

The buoyancy on Wall Street spilled across the Atlantic, pushing Europe’s broad Stoxx 600 equity index up 1 percent higher. Data on Friday had showed a sharp drop in eurozone inflation. Germany’s Xetra Dax jumped 0.9 percent. A softer dollar boosted the euro, which climbed 0.9 percent to $1.06100.

Reduced rate expectations also bolstered oil prices. Brent crude rose 1.2 percent to $79.61 a barrel, while U.S. West Texas Intermediate crude futures gained 1.4 percent to $74.71. [O/R]

A Reuters survey of economists showed the non-farm payrolls report was expected to show on Friday that 200,000 jobs were created in December, easing from November’s 263,000 pace but still about double the level the Fed considers sustainable.

Also read: US trade deficit shrinks most in nearly 14 years in November as imports decline

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Global equities, US dollar rise despite surprise weak China economic data

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Global equities and the US dollar advanced on Monday despite weaker-than-expected economic data in China that prompted its central bank to cut its lending rate, stoking concerns of a global recession.

The People’s Bank of China unexpectedly cut key interest rates after the world’s second-largest economy reported July data on industrial output and retail sales that missed most analyst estimates.

China’s strict COVID-19 restrictions have hobbled activity at its main manufacturing hubs and popular tourist spots, including Shanghai, even as a deepening downturn continues in the property market.

Markets reversed earlier session losses and were slightly higher. The MSCI world equity index, which tracks shares in 50 countries, was up 0.23 percent. Overnight in Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan had closed 0.34 percent lower.

“You’ve been seeing a slowing trend in China amplified by the lockdowns,” said Tom Plumb, portfolio manager at Plumb Balanced Fund in Wisconsin.

“The credit problems they’ve had especially with real estate developers, that’s going to tie their hands for how aggressive they can go back to stimulation. But I think it’s a sign they’re going to try to be more accommodative.”

The US dollar strengthened following news of the Chinese central bank action amid disappointing data. The dollar index, which measures the greenback against six peers, rose 0.785 percent, with the euro down 0.97 percent to $1.0158.

Oil prices dropped by more than 3 percent on demand concerns after the weak data from China, one of the largest importers of crude. Brent crude futures settled down 3.1 percent to $95.10 a barrel, while US West Texas Intermediate crude closed at $89.41, down 2.9 percent.

On Wall Street, major indexes climbed, reversing earlier session losses, following four straight weeks of gains and a likely moderation on US Federal Reserve interest rate hikes after a slowdown in inflation.

The Dow Jones Industrial Average rose 0.42 percent to 33,903.57, the benchmark S&P 500 gained 0.37 percent to 4,296.09 points, and the Nasdaq Composite added 0.59 percent to 13,123.89.

US Treasury yields were slightly lower as the market continued to assess to what extent a slowdown in inflation could impact the US Federal Reserve’s monetary tightening policies.

Benchmark 10-year Treasury yields were down to 2.795 percent from a 2.849 percent close last week. Two-year note yields fell to 3.1988 percent from 3.257 percent.

Gold fell over a percent to its lowest in a week on Monday amid sharp declines across precious metals due to a stronger dollar, with concerns over further rate hikes by the US Federal Reserve adding to pressure on bullion.

Spot gold dropped dropped 1.3 percent to $1,778.53 an ounce, while US gold futures fell 1 percent to $1,781.40 an ounce.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Global stocks slide amid worries over US rate hikes, Russia-Ukraine crisis

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Global stock markets and Wall Street futures sank on Wednesday after a Federal Reserve official’s comments fueled expectations of more aggressive US rate hikes and the White House announced more sanctions on Russia.

London and Frankfurt opened lower. Tokyo and Hong Kong fell, while Shanghai was little changed. Oil prices rose more than $1 per barrel.

Wall Street’s S&P 500 index tumbled 1.3 percent on Tuesday after Fed Governor Lael Brainard said reining in inflation that is at a four-decade high is of paramount importance.

On Wall Street, the future for the S&P 500 was off 0.5 percent and that for the Dow Jones Industrial Average retreated 0.4 percent. On Tuesday, the S&P 500 recorded its first loss in three days and the Dow fell 0.8 percent. The Nasdaq composite slid 2.3 percent.

In Asian trading, the Hang Seng in Hong Kong fell 1.9 percent to 22,080.52 and the Nikkei 225 in Tokyo sank 1.6 percent to 27,350.30. The Shanghai Composite Index ended up less than 0.1 percent at 3,283.43 after spending most of the day in negative territory.

BSE Sensex in India shed 0.98 percent to 59,629.07. New Zealand and Southeast Asian markets also retreated.

Traders are pricing in a nearly 78 percent probability the Fed will raise its key rate by half a percentage point at its next meeting in May. That would be double the usual margin of change and a step the Fed hasn’t taken since 2000.

Higher interest rates tend to hurt stocks that are seen as the priciest, which puts the focus on big technology and other high-growth stocks. On Wall Street, Apple and Tesla were some of the biggest weights on the market Tuesday.

Wall Street is watching for clues as to how sharply interest rates will rise. On Wednesday, the Fed is due to release minutes from its March interest rate meeting.

Twitter rose another 2 percent after disclosing an arrangement with Tesla chief Elon Musk that will give him a board seat but also limit how much of the company he can buy while he’s a director. The company disclosed a day earlier that the billionaire Twitter critic had become its largest shareholder.

Brent crude, the price basis for international oil trading, added $1.10 to $107.74 per barrel in London. It declined 89 cents the previous session to $106.64.

The dollar rose to 123.82 Japanese yen from Tuesday’s 123.61 yen. The euro advanced to $1.0919 from $1.0905. The Indian rupee fell 0.50 percent to hit the day’s low at 75.71/$ as the Indian equity market resumed a decline after trading above the day’s low.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian shares steady, set for weekly gain in volatile trading

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian shares were headed for a second successive week of gains on Friday, though trading was choppy amid hawkish US monetary policy, shifts in Chinese economic policy, and ongoing ructions in commodity markets due to the war in Ukraine.

MSCI’s broadest index of Asia-Pacific shares outside Japan traded flat, but it’s up 1 percent on the week.

Japan’s Nikkei was also little changed having closed the previous day at a nine week high.

Hong Kong shares were a drag on the regional benchmark, falling 0.5 percent, weighed down by tech stocks, as US and Hong Kong dual listed names took a hit from renewed fears that a row over audit records will force them to delist in the United States.

Australian stocks rose 0.4 percent helped by miners, while Chinese blue chips lost 0.4 percent.

“In terms of Asia we have seen asset prices stabilise a little bit this week following last week’s statement from the Chinese vice premier. This may not be sustainable unless we see additional easing and have better visibility on the regulatory front, but it did seem to have the desired effect in terms f limiting downside risks,” said Carlos Casanova, senior Asia economist at UBP.

“Though what we are starting to see is a little more caution from global investors when it comes to the US economy, and what that means for Asia,” he added.

Last week, Chinese vice premier Liu He said Beijing would roll out support for the Chinese economy, sending Chinese and Hong Kong stocks higher initially.

Investors were also watching to see whether the Bank of Japan would intervene to buy Japanese government bonds (JGB) as its yield target came under pressure.

The yield on 10 year JGBs rose to 0.235 percent on Friday morning, exceeding the level at which the BOJ offered to buy an unlimited amount of JGBs at 0.25 percent on Feb. 10, part of a policy to maintain interest rates at their current ultra-low levels.

Japanese bond yields are being pulled higher by US Treasury yields, which have risen along with expectations for a more aggressive pace of rate hikes by the US Federal Reserve.

US 10 year notes last yielded 2.3681 percent just off Tuesday’s 22-month high of 2.417 percent.

Chicago Fed President Charles Evans was the latest US policymaker to sound more hawkish, saying on Thursday the Fed needs to raise interest rates “in a timely fashion” this year and in 2023 to curb high inflation before it is embedded in US psychology and becomes even harder to get rid of.

The divergence between US and Japanese monetary policy has weighed on the yen. On Friday, the dollar climbed a further 0.41 percent to 121.84 yen, a new multi year high. Higher commodity prices driven by the war in Ukraine is also hurting the Japanese currency, as Japan imports the bulk of its energy.

The dollar’s gains against other currencies have been less dramatic, however, with the US currency’s index measure against six peers down a little at 98.536.

Overnight the three main U.S. stock indexes each rallied more than 1 percent, as investors snapped up beaten-down shares of chipmakers and big growth names and supported by a fall in oil prices.

S&P 500 future inched up 0.1 percent in early Asia trade.

Oil continued to slide a little, as the United States and allies considered releasing more oil from storage to cool markets. Brent crude falling 0.22 percent to $118.77 per barrel and US crude down 0.5 percent to $111.74 a barrel, but prices were still very high by historic standards.

Spot gold remained elevated at $1961.9 an ounce, up 0.22 percent.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Opening Bell: Indices extend rally to 6th session, gain amid sharp decline in oil prices

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Indian equity benchmark indices on Tuesday extended their strong rally to a sixth session amid a sharp fall in crude oil prices from their record highs and investor concerns over the ongoing Russia-Ukraine crisis.

At 09:15 am, the Sensex was up 199.98 points or 0.35 percent at 56,686, and the Nifty was up 15.10 points or 0.09 percent at 16,886.40. About 1,459 shares have advanced, 439 shares declined, and 64 shares are unchanged.

While Asian Paints, Maruti Suzuki, Tata Consumers, Mahindra & Mahindra and Cipla were the top Nifty gainers, ONGC, Hindalco, Tata Steel, JSW Steel, Kotak Mahindra Bank were the top laggards.

Broader markets looked upbeat with the BSE MidCap and SmallCap indices in the positive territory, up to 0.6 percent, respectively. India VIX cooled off in the red.

Among sectoral indices, Nifty realty was up 1.18 percent while auto was up 0.94 percent. Nifty FMCG, Bank, Pharma were trading up between 0.31 to 0.68 percent up. Nifty Metal decline 1.68 percent while IT and Media also dragged.

Global markets

Asian stocks were in the red on Tuesday as surging COVID-19 cases in China hit the confidence of investors who are already worried about the Ukraine war and the first US interest rate rise in three years, which could come this week.

Major US stock indexes closed mostly lower on Monday, led by a more than 2 percent drop in Nasdaq, as investors sold tech and big growth names ahead of this week’s Fed’s meeting.

Oil prices slid to a two-week low on Tuesday on continued ceasefire talks between Russia and Ukraine and concerns about demand in China after a surge in Covid-19 cases.

Brent futures dropped $4.20 or 3.9 percent to $102.70 a barrel by 0125 GMT after falling 5.1 percent the previous day.

Catch CNBC-TV18’s live market updates here 

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Strong US earnings lift global equities amid inflation, geopolitical concerns

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Global equity markets eked out gains Friday at the end of a tumultuous week dominated by concerns over the Federal Reserve’s monetary policy and geopolitical tensions between Russia and the West.

Strong earnings from Apple and other tech firms buoyed US markets during the session but the major indexes remained on course for a weekly drop, as did the pan-European STOXX 600 index, down over 1 percent on the day for a fourth week of losses. Economic reports helped eased inflation fears.

“The widely-watched employment cost index came in a touch softer than expected suggesting wages may start to cool some from here,” said Stephanie Roth, a senior markets economist at JP Morgan Private Bank.

“Hot wage growth has been a key factor behind the Fed’s pivot, so if this trend continues that would relieve some pressure.”

Also Read | IMF warns of further stock selloff in US after Fed move on interest rate hikes

MSCI’s 50-country main world index gained 0.50 percent but remained on the brink of its worst January since the 2008 global financial crisis after shedding roughly $7 trillion in value.

The dollar, meanwhile, consolidated gains and was on track for its biggest weekly rise in seven months against other major currencies as markets priced in a year ahead of aggressive hikes in US interest rates.

“The big issue is the Fed, which is clearly in a tightening cycle. Financial market support is not part of the central bank’s agenda,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.

“The only question is whether the markets have fully digested (Fed Chair Jerome) Powell’s guidance in his press conference…I would expect the equity and bond markets to find bottoms at some point relatively soon,” he added.

The Fed on Wednesday indicated it is likely to raise rates in March, as widely expected, and reaffirmed plans to end its pandemic-era bond purchases that month before launching a significant reduction in its asset holdings.

On Wall Street, the Dow Jones Industrial Average rose 0.43 percent and the S&P 500 gained 1.00 percent. The Nasdaq Composite added 1.52 percent.

The prospect of faster or larger US interest rate hikes and possible stimulus withdrawal lifted the dollar index 0.014 percent, while the euro gained 0.05 percent.

On bond markets, the yield on benchmark 10-year Treasury notes was down 2.1 basis points to 1.787 percent as the Fed’s favored inflation gauge, the core personal consumption expenditure price index (PCE), rose no more than had been expected.

Also Read | Meme stock hangover: A year after GameStop, traders face gloomier markets

In the 12 months through December, the PCE increased 5.8 percent. That was the largest advance since 1982 and followed a 5.7 percent year-on-year increase in November.

The two-year US Treasury yield, which typically moves in step with interest rate expectations, was down 2.2 basis points at 1.170 percent, having started the year at roughly 0.75 percent.

Britain’s pound rose close to a 23-month high against the euro as investors expected the Bank of England to raise rates next week and follow a path of rapid monetary tightening in 2022.

Investors also cheered the US Securities and Exchange Commission’s (SEC) late Thursday approval of the country’s 17th stock exchange, a subsidiary of Boston-based BOX Exchange, which will incorporate blockchain technology.

The new exchange, named BSTX, aims to launch in the second quarter and will initially trade securities, such as stocks or exchange-traded funds, first listed on its exchange, but those securities would be tradable on rival bourses.

Investors were digesting a European Union document that showed foreign banks based in the EU may have to hold more capital and liquidity under revisions to rules being considered by the bloc’s member states.

In Italy, bond yields rose as its parliament struggled to elect a new president.

Also Read | Crude oil prices hit 7-year peak on political risks, supply crunch

Oil pressure

Oil prices reached seven-year highs after the inflation data and as geopolitical tensions continue to raise concerns that the Ukraine crisis could disrupt energy markets.

US President Joe Biden and his EU counterpart Ursula von der Leyen pledged to cooperate on guaranteeing the energy security of Europe and Ukraine amid the standoff triggered by Russia amassing troops at Ukraine’s border.

US crude was up 0.12 percent at $86.71 per barrel and Brent was at $89.92, up 0.65 percent on the day.

Investors cautiously start to buy US crude when prices fall given supply disruption concerns due to rising geopolitical tensions, said Tatsufumi Okoshi, senior economist at Nomura Securities.

“The market expects supply will stay tight as OPEC+ is seen to keep the existing policy of gradual increase in production,” he said.

The market is focusing on a Feb. 2 meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, a group known as OPEC+. It is likely to stick with a planned rise in its oil output target for March, several sources in the group told Reuters.

Also Read | Natural Gas prices continue to surge amid higher demand, rising Russia-Ukraine tensions

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

World stocks gain ahead of Federal Reserve meeting outcome, crude oil watches Russia-Ukraine

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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World stocks edged up and the dollar was flat ahead of the outcome of the Federal Reserve’s policy meeting on Wednesday, while crude oil prices rose towards recent seven-year highs on the tension between Russia and Ukraine.

The Fed is due to update its policy plan at 1900 GMT after a two-day meeting. A first-rate increase is seen in March and markets are already pricing in three more quarter-point increases by year-end.

The MSCI world index rose 0.32 percent. US equities were more upbeat, however, with US S&P futures up 1.01 percent after the index lost 1.22 percent in the previous session. European shares climbed 1.47 percent and Britain’s FTSE 100 gained 1.38 percent.

Also Read | Crude oil prices edge up on Russia-Ukraine tension; Fed, EIA data eyed

US stocks posted their worst week since 2020 last week, and the MSCI index is on course for its biggest monthly drop since the COVID-19 pandemic hit markets in March 2020, though analysts at Goldman Sachs said equities had not reached “danger zone” levels.

Sebastien Galy, senior macro strategist at Nordea Asset Management, said that given the recent volatility, he expected the Fed would be “far more cautious about the timing and pace of the balance sheet reduction and that will be welcomed by the equity market”.

Growing tension as Russian troops massed on Ukraine’s border have added to a risk-averse environment for investors.

US President Joe Biden said on Tuesday he would consider personal sanctions on President Vladimir Putin if Russia invaded Ukraine, as Western leaders stepped up military preparations and made plans to shield Europe from a possible energy supply shock.

US crude rose 0.27 percent to $85.82 a barrel after getting close to $88 last week. Brent crude rose 0.44 percent to $88.57 per barrel.

Also Read | Russia-Ukraine tensions and its impact on commodity prices; details here

The dollar index was steady at 96.08 against a basket of major currencies, and the euro was at $1.1286, near one-month lows set on Tuesday.

The Canadian dollar strengthened around 0.4 percent to 1.25905 versus the dollar. Odds are split on whether or not the Bank of Canada will raise rates for the first time since 2018 on Wednesday, with Omicron seen potentially delaying the start of an aggressive tightening campaign aimed at taming inflation.

US Treasury yields on two-year notes inched up to 1.0433 percent, holding onto gains made earlier this month. The yield on benchmark 10-year Treasury notes was 1.7851 percent, a little below the two-year high of 1.9 percent hit last week. German 10-year government bond yields edged up to -0.069 percent.

MSCI’s broadest index of Asia-Pacific shares outside Japan was unchanged, after sharp losses earlier in the week which have left the index off 2.8 percent this year. It is testing mid-December’s one-year low.

Japan’s Nikkei traded 0.44 percent lower, close to its lowest level since December 2020.

China’s blue-chip index hit its lowest since October 2020 before reversing to close up 0.72 percent. Hong Kong’s Hang Seng Index was up 0.12 percent.

Hao Hong, head of research at BOCOM International, expects limited appetite from investors to hold big positions in Asia after heavy market selling as the Lunar New Year holiday approaches.

Gold prices ticked down to $1,844 per ounce, after hitting a 10-week high in the previous session.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Global stocks fall, gold prices spike, dollar gains, bitcoin down as high US inflation sparks tightening fears

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The US stock markets fell and the dollar gained on Wednesday as US consumer inflation surged to its highest since 1990, raising concerns the Federal Reserve will hike rates sooner than expected.

Gold prices hit a five-month high, bolstering the metal’s appeal as a hedge against inflation. Real yields on US Treasuries slid to record lows after the Labor Department reported a big jump in the consumer price index in October.

The US Consumer Price Index (CPI) rose 0.9 percent on a monthly basis after rising 0.4 percent in September as the largest gain in four months boosted the annual increase to 6.2 percent. It was the biggest year-on-year rise since November 1990 and followed a 5.4 percent leap in September.

Wall Street’s so-called fear gauge, CBOE Volatility index, touched its highest level in nearly one month.

MSCI’s all-country world index slid 0.71 percent as a decline on Wall Street accelerated. But the broad STOXX Europe 600 index rose 0.22 percent to end at a record closing high following strong earnings from the media and energy sectors.

STOXX 600 listed companies profits are expected to jump 60.7 percent in the third quarter to 104.4 billion euros ($120.7 billion) from a year earlier, according to a Reuters report citing new Refinitiv data.

The Dow Jones Industrial Average fell 0.66 percent, the S&P 500 slid 0.82 percent and the Nasdaq Composite declined 1.66 percent as the big US megacap names led the downturn. Growth stocks fell 1.26 percent but value shares just 0.29 percent.

Despite the slide on Wall Street the US economy is booming and corporate pricing power is resilient, which means revenues can grow and lift profits too, the report said.

The dollar jumped on the CPI data, with the euro hitting a 16-month low against the greenback.

The dollar index, which tracks the greenback versus a basket of six currencies, rose 0.914 percent to 94.886. The euro fell 0.97 percent at $1.1479, while the yen gained 0.95 percent at $113.9200.

The Treasury breakeven inflation curve, a measure of what inflation level an investor would break even with on a given Treasury note yield, shows investors expect inflation to run at 4.72 percent in the coming year, before declining to 3.59 percent in two years, 3.14 percent in five years and 2.67 percent in 10 years.

The yield on benchmark 10-year US Treasury notes rose 11.4 basis points to 1.5630 percent in late trade on Wednesday, after touching a six-week low of 1.4150 percent on Tuesday.

Euro zone bond yields also ticked up, with Germany’s 10-year yield, the benchmark for the bloc, up 4 basis points at -0.243 percent, above a seven-week low of -0.299 percent touched on Tuesday. [GVD/EUR]

Oil prices slumped, hit by the surging dollar, after President Joe Biden said the US administration was looking for ways to reduce energy costs amid a broader surge in inflation.

Brent crude fell $2.14 to settle at $84.64 a barrel. US crude lost $2.81 to settle at $81.34 a barrel.

US gold futures settled 1 percent higher at $1,848.30 an ounce.

Bitcoin declined 1.64 percent to $65,844.

–With agency inputs

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Delta, Fed dominate economic conversation as stocks jump, oil drops

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stocks recovered ground Friday despite concerns about economic growth amid rising COVID-19 cases, which continued to take its toll on oil prices.

The Dow Jones Industrial Average ended up 0.65 percent, while the S&P 500 gained 0.81 percent and the Nasdaq Composite added 1.19 percent. However, all three indices ended with weekly losses following a steep mid-week sell-off after Federal Reserve meeting minutes underlined the US central bank’s plans to pare back stimulus by year’s end.

The MSCI world equity index, which tracks shares in 45 nations, rose 0.43 percent.

“We are seeing a relief rally in European and US assets today,” said Phil Guarco, global investment specialist at JP Morgan Private Bank.

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The Fed is likely to dominate the economic conversation next week as well with an annual meeting of central bankers at Jackson Hole, Wyoming. Markets will be watching for any clearer indication on plans for a Fed taper of monthly bond purchases, which minutes showed officials believed would happen this year if the economy recovers as expected. Fed Chairman Jerome Powell will deliver remarks on the economic outlook next Friday.

Economic uncertainty also helped boost safe-haven investments this week, although most ended Friday flat or declining. The US dollar touched highs not seen in 9-1/2 months Friday before ending the day slightly down. The dollar index, which tracks the greenback versus a basket of six currencies, fell 0.13 percent.

Gold was up slightly, with spot gold prices climbing 0.07 percent to $1,781.51 an ounce. Benchmark 10-year yields rose two basis points on the day to 1.260 percent, but are down from 1.283 percent last week.

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Oil’s slip

The concern that rising COVID-19 cases globally could handcuff travel demand continued to weigh down oil markets, which fell for the seventh straight session. Brent crude ended the week down 2.17 percent at $65.01 a barrel, while US crude fell 2.26 percent at $62.25 per barrel.

Overall, oil faced its biggest week of losses in more than nine months.

Rabobank analysts said in a note they believed much of the downturn was due to systemic selling rather than a fundamental reorientation of market expectations.

“We are attributing a large portion of the recent fall in oil prices to the herd-like behavior of systematic funds rather than to any material shift in the fundamental outlook for oil markets,” Ryan Fitzmaurice, Rabobank’s senior commodity strategist, wrote in a note. “We expect oil balances to remain tight and for prices to stabilize and grind higher as soon as the aggressive systematic selling we have been witnessing starts to wane.”

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow