Market Wrap: 7 January 2023

Market Wrap: 7 January 2023

Asian Stocks Edge Higher as Investors Await Powell:

  • Japan’s nominal wage jump raises bets BOJ will adjust stimulus
  • Fed Chair Powell due to speak Tuesday, RBA decision in focus

 

US and European equity futures and Asian stocks made small gains as investors awaited commentary from Federal Reserve Chair Jerome Powell later Tuesday.

A gauge of the region’s shares rose about 0.6%, trimming losses from the biggest two-day drop in four months, as investors weigh the chances of the Fed keeping a firm grip on monetary policy.

Some of the strongest gains Tuesday were in tech stocks listed in Hong Kong — providing a sharp contrast to the decline in US equities Monday when the S&P 500 and the tech-heavy Nasdaq 100 both finished lower as bond yields rose. Baidu Inc. surged as much as 13% after affirming it will launch a ChatGPT-like bot in March.

Treasuries clawed back some of the two-day rout that was sparked by traders ramping up bets on future Fed tightening. The recent move has taken the shine off the best start to a year for cross-asset returns since 1987.

Australian bonds fell following the moves in the US market and before an interest rate decision from the central bank, which is forecast to hike by 25 basis points. 

Investors are weighing whether Powell may emphasize that optimism for rate cuts later in 2023 is probably misplaced. Atlanta Fed President Raphael Bostic said Monday the strong jobs data on Friday raises the possibility that the central bank will need to increase interest rates to a higher peak than policymakers had previously expected.

 

“Fed Chair Powell remains a big wild card every time he speaks,” said Chris Senyek at Wolfe Research. “Investors will be looking to see if he ‘walks back’ his very dovish tone from last Wednesday, particularly with respect to financial conditions and the US ‘disinflationary process.’ We still believe that the Fed will be ‘higher for longer’.”

 

The yen held most of its losses from Monday after broad gains in the dollar sent a gauge of the greenback up for a third day. Japan unexpectedly reported nominal wages jump in December by the biggest margin in nearly 26 years, stoking market bets that the central bank will adjust or back away from its stimulus program under a new governor.

There also seems to be no quick fix to the stock rout roiling Gautam Adani’s indebted conglomerate. The meltdown since US short-seller Hindenburg Research made fraud allegations against the ports-to-power group in a Jan. 24 report has wiped out $117 billion, or almost half of the market value of its companies. Adani has repeatedly denied the claims.

 

The air of caution in global markets is being reinforced by geopolitical concerns. The US is preparing to impose a 200% tariff on Russian-made aluminum, while the US started to recover some parts from the Chinese balloon that a fighter jet shot down off the coast of South Carolina. Biden administration officials said the US was still trying to figure out how much senior leaders in Beijing knew about the alleged spy mission.

Elsewhere, oil extended gains after Saudi Arabia unexpectedly raised its crude prices to Asia, signaling confidence in the demand outlook. Gold edged up.

Source: Bloomberg.com

 

Trade the global markets with a broker that has integrity, honesty and transparency at its core

過去のニュース

This website is owned and operated by the Ox Securities group of companies, which include:
Ox Securities Pty Ltd registered address Level 37, 1 Macquarie Place, Sydney NSW 2000 Australia. AFSL 438402 ACN 163 551 602
Ox Securities Limited (SV) registered address Suite 305, Griffith Corporate Centre, Beachmont, Kingstown, St Vincent and the Grenadines
Risk Warning: The information contained on this website is general in nature and does not constitute advice or a recommendation to act upon the information or an offer. The information on this website does not take into account your personal objectives, circumstances, financial situations or needs. You are strongly recommended to seek independent professional advice before opening an account with us and/or acquiring our services/products. Ox Securities Limited (SV) do not accept applications from residents of the United States of America and Australia
Before you decide whether or not to invest any products referred to on this website, being over the counter (OTC) derivatives, it is important for you to read and consider our Financial Services Guide (FSG), Product Disclosure Statement (PDS), and Terms and Conditions (T&C), and ensure that you fully understand the risks involved. Fees, charges and commissions apply. OTC derivatives, including margin foreign exchange contracts and contract for differences, are leveraged products that carry a high level of risk to your capital. Trading is not suitable for everyone. You may incur losses that are substantially greater than your initial investment. You do not own, or have any rights to, the underlying assets which the OTC derivative is referring to. You should only trade with money you can afford to lose. There are also risks associated with online trading including, but not limited to, hardware and/or software failures, and disruptions to communication systems and internet connectivity.

Copyright © OxSecurities 2020. All rights reserved