Date: 20th August 2024.
Market News – Its all about market sentiment.
* Wall Street continued its run higher as the panicked trade from early in the month continues to recede while outlooks on the Fed remain dovish heading into Chair Powell’s Jackson Hole speech Friday.
* Asian stocks mostly rose on Tuesday, driven by positive momentum from Wall Street as it neared record highs.
* Chinese property developer Kaisa announced a restructuring agreement with creditors to avoid legal challenges over its 2021 default. The deal includes issuing $5 billion in new bonds and $4.8 billion in convertible bonds. (Kaisa, once the largest offshore borrower after Evergrande, faces a winding-up petition in Hong Kong, though the case has been repeatedly delayed.)
* The RBA indicated that it will likely maintain interest rates at their 12-year high for an “extended period” to ensure inflation returns to target by next year.
* In Europe, growing risks to economic growth have strengthened the argument for a policy shift at the ECB’s meeting next month. Markets are also watching the EU CPI release due later today.
Asian & European Open:
* Expectations for lower rates helped boost the NASDAQ by 1.39%. The S&P500 climbed to its 8th consecutive gain and its best run since November. It is just the 2nd close over 5600 as it sets its sights on the record 5667 from July 16. The Dow rose 0.58% to 40,896 as 41,198 is back in view.
* The Nikkei surged 2.1% to 38,156.41, recovering from a previous 1.8% drop.
Financial Markets Performance:
* The USDIndex sank to 101.60, the weakest since early January.
* The Yen fluctuated against the US dollar, trading at the 147.33, rebounding from the 145-146 area.
* USOil prices decline to largest drop in 2 weeks, i.e. $72.76, as the US said Israel accepted a cease-fire proposal in Gaza, potentially easing supply risks as concerns about the global demand outlook mount.
* Bitcoin climbed to $60,974 while Gold continued to trade at about $2,500 close to its all-time high, fueled by expectations of impending Fed rate cuts.
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Please note that times displayed based on local time zone and are from time of writing this report.
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Andria Pichidi
Market Analyst
HFMarkets
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