Tag: global markets

Most Asian currencies pressured by US dollar holding near 2018 peaks, US-China trade talks

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

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Most Asian currencies were lower on Monday, with the Thai baht falling the most, as the US dollar held near its 2018 peak as it shrugged off weaker US jobs and wages data out on Friday.

Investor sentiment on the dollar remained buoyant, despite data showing US job growth increased less than expected in April and the unemployment rate dropped to near a 17-1/2-year low of 3.9 percent.

Andy Ji, a strategist for Commonwealth Bank of Australia in Singapore says the Sino–US trade talk last week failing to agree on steps to close a gap in expectations may also keep Asian currencies pressured.

“In particular, the US demand of a reduction to the bilateral trade deficit by $200 billion by 2020 is extremely challenging, as it not only requires a secular shift in the long-term savings and investment behaviour, but also, in the short-term, represents a significant disruption to global value chains.”

A list of demands was presented to Beijing before the start of talks between top-level Trump administration officials and their Chinese counterparts on Thursday and Friday to try to avert a damaging trade war between the world’s economic superpowers.

“As such, we continue to expect South Korean won, Singapore dollar and Taiwan dollar to underperform their regional peers given the heightened uncertainty,” Ji added.

The Thai baht fell the most in the region to its lowest in nearly three months, down as much as 0.7 percent, while the Philippine peso declined 0.5 percent after two gaining sessions.

The Indian rupee fell to its lowest since February last year, on risk aversion after oil prices surged.

The Taiwan dollar was marginally higher ahead of April trade data to be out later in the day.

A Reuters poll showed that Taiwan’s April exports were seen rising 11.4 percent thanks to continuing demand for the island’s high-tech products.

Taiwan’s exports rose 16.7 percent in March to a record high in value terms.

China’s yuan edged up. Foreign exchange reserves for the month of April are expected later on Monday with a Reuters poll showing reserves may have dipped slightly to $3.133 trillion.

Trade in the South Korean won was closed on Monday for a local holiday.

INDONESIAN RUPIAH

The rupiah declined the most since January 2016 as investors awaited first quarter growth figures.

Official data showed that Indonesia posted January-March economic growth of 5.06 percent, falling slightly from the previous quarter, reflecting still-weak consumption and indicating the government may struggle to get economic expansion to its 5.4 percent target this year.

Monday’s figure undershot a Reuters poll estimate of 5.18 percent growth and the previous quarter’s 5.19 percent.

Lower than expected growth could put the central bank in a bind. Bank Indonesia has said it would tighten monetary policy to halt further depreciation of the currency if it threatened the inflation target or financial stability.

Annual growth in Indonesia’s economy, Southeast Asia’s largest, has hovered at around 5 percent. Last year’s 5.07 percent crate was the best since 2013, but still far below the 7 percent President Joko Widodo has aimed for.

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

Market trades higher, Nifty inches toward 10,700; RIL, banks gain

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

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The market continued to trade higher with the BSE Sensex trading at 34,956 points and the NSE Nifty inching towards 10,700 points at 10,687 points.

The NSE Nifty briefly touched 10,700 after February 5, 2018, but is now back in the 10,600 range.

RIL stock gained, but was no longer trading at its peak. The stock gained by 2.62% as against the morning numbers, 2.88%, ahead of its earnings.

The banks – SBI, ICICI and Axis Bank- are the top three gainers and bank gainers today. Axis Bank is topping the list, despite a disappointing Q4 result which was announced yesterday.

The market opened higher backed by global cues with the BSE Sensex trading at 34,844 points and the NSE Nifty trading at 10,655 points.

The Asian markets are trading in the green with Korea’s KOSPI and Japan’s Nikkei gaining by around 0.70%.

The US market ended higher backed by stellar earnings. Dow Jones gained more than 200 points in trade and ended at 24,322 points. Nasdaq and S&P 500 (US) gained more than a percent.

The SGX Nifty is trading 10,680 levels, continuing to indicate positive cues for the Indian market today.

Along with RIL, Maruti, Shoppers Stop, IDFC, RBL Bank, among others will declare their quarterly earnings today.

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

Gold falls on strong dollar and higher US yields

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

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Gold fell on Wednesday as the dollar and US Treasury yields jumped on robust US data and signs of an easing in the US-China trade conflict.

US Treasury yields rose to 3% for the first time in more than four years, reflecting the durability of the US economic expansion after US consumer confidence rebounded in April and new home sales increased more than expected in March.

But higher yields on bonds make gold a less attractive investment because it pays no interest.

Meanwhile, there was a decline in political risk after the United States said it would likely reach a trade agreement with China and that officials from both sides would sit down for negotiations in a few days.

“Recently there has been some optimism that the US-China trade war isn’t going to be as big of an issue,” said Natixis precious metals analyst Bernard Dahdah.

“There is a bit more confidence in the US and that negatively affects gold, naturally, in terms of geopolitics.”

Spot gold was down 0.4% at $1,325.06 per ounce, as of 0945 GMT, erasing the gains made in the previous session when it broke a three-session losing streak.

US gold futures dropped 0.5% to $1,326.50 per ounce.

The dollar index, which measures the greenback against a basket of currencies, rose 0.2% to 90.954.

World stocks were down for the fifth straight session on Wednesday.

In other geopolitical news, North Korean leader Kim Jong Un is due to hold a summit with South Korean President Moon Jae-In on Friday, and is expected to meet with Trump in late May or early June.

“As traders put geopolitical and trade risk in the rear-view mirror for the time being, how the dollar flourishes and wilts will be the primary driver of near-term gold sentiment,” said Stephen Innes, APAC trading head, OANDA.

Gold is often seen as an alternative investment during times of political and financial uncertainty.

“I think that the downward trend (in gold prices) will continue for the next few days…” ahead of a meeting between leaders of North Korea and the South, said Ji Ming, chief analyst, Shandong Gold Group.

In other precious metals, spot silver dropped 0.7% to $16.58 an ounce, and platinum eased 0.3% to $923.30 an ounce.

Palladium fell for a third straight session, down 0.9% at $965.70 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 dip on oil, tech weakness; oil slips after Trump remarks

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

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World stocks dipped on Friday amid weakness in the energy sector and as worries about a global slowdown in smartphone demand dented the technology sector, while oil prices fell after US President Donald Trump said prices were artificially high.

While the MSCI index of global stock markets was down 0.91% on the day, it was still poised for its second week in the black after a strong start to the corporate earnings season.

A robust earnings season could offset fears of slowing global growth and help stock markets recover from a turbulent first quarter which saw greater volatility, a trade spat between the United States and China, and increased geopolitical tensions in the Middle East over Syria.

“While fundamentals remain robust, geopolitics and trade war fears, concerns over slowing global growth, and idiosyncratic issues in the tech sector have all weighed,” Deutsche Bank strategists wrote in note to clients, noting that a full-blown trade war between the US and China was a major risk.

“In equities we see the recent correction as overdone, and the first quarter earnings season could act as the needed circuit breaker.”

Wall Street equities slid on weakness in energy stocks, dented by the falling oil prices, and a second session of limp tech stocks following a slide by Apple Inc and its suppliers on Thursday.

The Dow Jones Industrial Average fell 187.96 points, or 0.76%, to 24,476.93, the S&P 500 lost 19.45 points, or 0.72%, to 2,673.68 and the Nasdaq Composite dropped 72.64 points, or 1%, to 7,165.42.

Oil prices tanked after Trump said via Twitter that prices were “artificially very high” and “will not be accepted.”

US crude fell 0.42% to $68.00 per barrel and Brent was at $73.35, down 0.58% on the day.

However, they were still set for a second consecutive week of gains, buoyed by tightening supplies and continued support from OPEC and its allies on supply cuts.

The recent surge in oil prices to their highest for more than three years supported bond yields across the euro zone. Higher oil prices tend to push up inflation, which strengthens the case for tighter monetary policy and higher rates.

Asian shares slipped as a warning from the world’s largest contract chipmaker knocked the tech sector.

MSCI’s broadest index of Asia-Pacific shares outside Japan closed 1.45 percent lower, while Japan’s Nikkei lost 0.13%. Emerging market stocks lost 1.52%.

Shares in Europe fell 0.14% but were on track for a fourth week of gains.

Dovish remarks overnight from Bank of England Governor Mark Carney weakened sterling and helped the FTSE 100 index advance. It was last up 0.35%.

Sterling continued to fall against the dollar, hitting its lowest against the greenback since April 6.

Expectations of a British interest rate increase in May have shrunk to 40 percent from 70% earlier this week.

The dollar index, measured against a basket of peer currencies, rose 0.41 percent, with the euro down 0.54% to $1.2274.

Spot gold dropped 0.5% to $1,338.84 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

Asia resource stocks rally as oil surges, bonds suffer

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

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Resource stocks were on a roll in Asia on Thursday as oil prices hit heights not seen since late 2014, though the potential boost to inflation globally also pressured fixed-income assets.

Brent crude futures climbed another 34 cents in early trade to $73.82 a barrel, adding to a 2.7 percent jump overnight. US crude gained 30 cents to $68.77.

The surge came on a Reuters report that OPEC’s new price hawk Saudi Arabia would be happy for crude to rise to $80 or even $100, a sign Riyadh will seek no changes to a supply-cutting deal even though the agreement’s original target is within sight.

“The Saudis and their colleagues in OPEC need higher oil for their fiscal positions and the Kingdom is on a bold – and costly – reform programme,” said Greg McKenna, chief market strategist at CFD and FX provider AxiTrader.

“So, they might continue to squeeze the lemon while they have the chance and the hand.”

The leap in oil combined with fears that sanctions on Russia could hit supplies of other commodities to light a fire under the entire sector. Aluminium prices reached their highest since 2011, alumina touched an all-time peak and nickel jumped the most in 6-1/2 years. [MET/L]

Such increases, if sustained, could fuel inflationary pressures and investors hedged by selling sovereign bonds.

Yields on US two-year Treasuries climbed to levels last visited in 2008 at 2.43 percent while 10-year yields  jumped 6 basis points to 2.87 percent.

Resource stocks were the big winners driving Australia’s main index up 0.6 percent. Japan’s Nikkei gained 0.4 percent, led by a 1.8 percent rise in basic material stocks.

MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.15 percent, while E-Mini futures for the S&P 500 edged up 0.1 percent.

Wall Street had also seen hefty gains in the energy and industrial indexes, though that was offset by softness in sectors such as consumer staples and financials.

IBM’s  7.5 percent drop was the biggest drag on the S&P after the technology company’s quarterly profit margins missed Wall Street targets.

The Dow ended down 0.16 percent, while the S&P 500 gained 0.08 percent and the Nasdaq 0.19 percent.

In currency markets, the US dollar remained very much range bound with its index flat at 89.623. It was a fraction firmer on the yen at 107.33 yen, but still short of recent peaks at 107.78.

The euro hovered at $1.2379, after easing from the week’s top of $1.2413.

The Canadian dollar hit a one-week low after the Bank of Canada sounded more dovish than expected, saying it did not know when or how aggressive it would need to be on tightening in order to keep inflation in check.

Sterling was softer at $1.4205 after a surprisingly tame reading on inflation led the market to reconsider the likely pace of future rate rises from the Bank of England.

Data out on New Zealand on Thursday showed annual inflation there had slowed to just 1.1 percent in the first quarter, underlining expectations that interest rates would remain at record lows for many more months to come.

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

Asia shares edge up with Wall Street, wary on China

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

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Asian shares crept ahead on Wednesday after Wall Street took heart from upbeat corporate earnings, though nagging concerns about trade barriers and the global growth outlook kept currencies and bonds subdued.

Dealers were anxious to see if a surprise policy move by the China’s central bank late on Tuesday might help soothe Shanghai markets after a couple of days of sharp losses.

The PBOC will reduce the cash banks hold as reserves in a move that frees up lending for small firms but falls short of a broad monetary easing.

The Shanghai index hit a near one-year low on Tuesday after the United States banned American companies from selling components to Chinese telecom equipment maker ZTE Corp.

MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.2 percent in early trade, though that follows four straight sessions of losses.

Japan’s Nikkei added 0.6 percent, with investors waiting for any developments on trade as Japanese Prime Minister Shinzo Abe meets President Donald Trump at his Mar-a-Lago resort.

E-Mini futures for the S&P 500 gained 0.1 percent after robust earnings from Netflix , Goldman Sachs and healthcare companies fuelled optimism about what is expected to be the strongest earnings season in seven years.

The Dow ended Tuesday up 0.88 percent, while the S&P 500 rose 1.06 percent and the Nasdaq 1.78 percent.

Yet there were signs of caution in the latest BofA Merrill Lynch survey of fund mangers which found investors squirreling more funds away into cash, while cutting their equity allocation to an 18-month low.

The outlook for the global economy also darkened with just a net 5 percent expecting stronger growth in the next 12 months – the lowest since the United Kingdom voted to leave the EU in June 2016.

While the IMF on Tuesday left its global growth forecasts unchanged for 2018 and 2019, it judged medium-term risks were to the downside – citing financial vulnerabilities, geopolitical strains and tariffs.

“The global narrative has quickly shifted from synchronous global growth, upgraded growth and glimmers of inflation in early 2018 to a focus on tariffs and protectionist rhetoric,” said Robert Rennie, head of financial markets strategy at Westpac.

“We ultimately believe that we will see a negotiated solution, but there is still a long way to go and further bouts of volatility and headline risk seem assured.”

Worries about the longevity of the US economic expansion were one reason the Treasury curve was at its flattest in a decade and why some interest-rate curves were starting to price in rate cuts for 2020.

The air of uncertainty was keeping currencies within well-worn ranges. The dollar hovered at 107.01 yen, having spent all of Tuesday in a half-a-yen band.

The euro was stuck at $1.2370, after topping out at $1.2413 overnight, while the dollar index was a fraction lower at 89.495 .

In commodity markets, gold was little changed at $1,346.32 an ounce.

Oil prices firmed with Brent crude futures up 17 cents to $71.75 a barrel, while US crude rose 33 cents to $66.85 a barrel.

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

Gold dips as sharper risk appetite lifts equities

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

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Gold fell on Tuesday as sharper appetite for risk benefited cyclical assets at bullion’s expense, though losses were capped by the dollar’s slip to three-week low against a basket of currencies.

Gold rallied to a 2-1/2 month high last week as heightened tensions over Syria and US sanctions on Russia sparked a drop in equities and ratcheted up interest in nominally defensive assets. Those gains, however, have proved hard to maintain.

Spot gold was down 0.2% at $1,342.40 an ounce by 0945 GMT, while US gold futures dropped 0.4% to $1,345.20.

“All this noise we’ve been witnessing as of late, whether it is trade disputes or Syria, has not really moved gold on a sustainable basis,” said Julius Baer analyst Carsten Menke.

“The story would be different if these disputes prevailed and we got a significant slowdown in leading indicators. But it doesn’t seem to me that anybody is really afraid of a material deterioration in the economic backdrop.”

A gradual return of risk appetite lifted world shares on Tuesday, with European stocks climbing 0.4% to erase the previous session’s losses.

The US yield curve reached its flattest in more than a decade on Monday after the White House said that US President Trump would nominate Richard Clarida as Federal Reserve Vice Chairman, another hawkish voice at the central bank.

A flatter yield curve typically indicates that the Fed is planning to lift interest rates in the near term and is often understood to signal concern over the macroeconomic outlook. Higher rates typically weigh on non-yielding bullion.

The euro hit a three-week high on Tuesday as solid Chinese economic data and receding fears of more US strikes in Syria revived risk sentiment, weakening the dollar.

On Monday, Trump also accused Russia and China of devaluing their currencies while the United States raises interest rates.

Among other precious metals, silver was up 0.1% at $16.62 an ounce and platinum rose 0.2% to $925.50.

Palladium retreated by 1.6% to $986 an ounce after hitting $1,012.10, its strongest since March 1, the previous day. It had rallied nearly 10% last week, the biggest weekly gain since January 2017, on fears that US sanctions on Russia could hurt supply of the autocatalyst metal.

“Palladium has gained by $100, or 11%, since the US sanctions were announced on April 6,” Commerzbank said in a note.

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

Nifty likely to move sideways in 100 points range this week, says Ashwani Gujral

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

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The market closed marginally higher amidst volatility on Friday with the Sensex and the Nifty posting gains for seventh day in a row. The Nifty failed to hold on to 10,500, closed with minor gains of 22 points at 10,481.

Nilesh Shah, market expert said that he will play the consumption game for a longer period of time rather than shorter period of time.

On IT sector, Nilesh said,  IT was under owned in whole of calendar year 2017. More importantly, after a long period of time it was available at discount to benchmark index valuations.

Market Expert Ashwini Gujral said Balkrishna Industries is moving to new highs, that is a buy with a stop loss of Rs 1295, target of Rs 1340.

Escorts is a buy with a stop loss of Rs 938, target of Rs 960 and Ashok Leyland is a buy with a stop loss of Rs 146, target of Rs 158.

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

Market likely to remain rangebound between 10,400 and 10,600, says Mitessh Thakkar

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

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The market is likely to remain rangebound between 10,400 and 10,600, Mitessh Thakkar, market expert, said.

The market ended largely in gains on Thursday with IT stocks taking the lead.

The BSE Sensex ended at 34,000 levels at 34,101 points, and the NSE Nifty ended at 10,400 levels at 10,458 points.

Mitessh Thakkar said the rupee and IT stocks surge helped pull up the markets. “So, it was not a very emphatic kind of a breakout.”

On HCL Tech, Thakkar said, “In the next 6-8 months there should be about 20% gains happening.”

“If you go by what the expectations on the street are in terms of guidance, the street is of the belief of 6 to 8% constant currency guidance growth, EBITDA margins between 23 to 25%, that is as far as the guidance from the management is concerned.” said Mayuresh on Infosys.

On the global markets, the stocks recovered to three-week highs on Friday as anticipated strong earnings season took centre stage after U.S. President Donald Trump backtracked on his suggestion of an imminent missile attack on Syria.

Here is what the stock market gurus recommend for today’s market session

>  Mitessh maintains a positive view on Infosys Technologies.

>  Mayuresh also maintains a positive view on HCL Tech.

>  Mayuresh also likes Vedanta from long-term perspective.

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 Markets: Stocks, dollar rise as risk appetite returns; oil slips

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

Listen to the Article (6 Minutes)

Wall Street led stocks higher globally on Thursday, despite declines in Asia, as investors focused on an earnings season expected to be strong and after US President Donald Trump cast doubt over the timing of his threatened strike on Syria.

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