Global Markets:
- Asian Stock Markets : Nikkei up 1.59%, Shanghai Composite up 2.08%, Hang Seng up 2.09% ASX up 1.76%
- Commodities : Gold at $2465.35 (0.57%), Silver at $28.78 (0.65%), Brent Oil at $79.53 (1.87%), WTI Oil at $76.29 (2.28%)
- Rates : US 10-year yield at 4.152, UK 10-year yield at 4.043, Germany 10-year yield at 2.330
News & Data:
- (USD) CB Consumer Confidence 100.3 vs 99.7 expected
- (USD) JOLTS Job Openings 8.18M vs 8.02M expected
Markets Update:
Asia-Pacific markets rose on Wednesday as investors assessed China’s business activity data. Japan’s Nikkei 225 reversed losses to log gains after the central bank raised benchmark interest rates to around 0.25%, the first increase above 0.1% since December 2008. Economists had expected the bank to hold rates at 0%-0.1%, though some anticipated a hike. China’s factory activity contracted slightly faster in July, with the manufacturing PMI at 49.4, down from 49.5 in June but above the 49.3 forecasted by a Reuters poll.
Australia’s second-quarter inflation rose by 1% compared to the previous quarter, with a 3.8% year-on-year increase. June’s inflation rate also stood at 3.8%, matching expectations and slowing from 4% in May. This weaker inflation reading might lead to potential rate cuts from the Reserve Bank of Australia or at least prevent further rate hikes. Meanwhile, Japan’s Nikkei 225 rose 1.5%, reversing earlier losses, and the Topix gained 0.37%. Retail sales in Japan increased by 3.7% year-on-year in June, surpassing the 3.2% rise expected by economists.
South Korea’s Kospi rose 0.58%, with Samsung Electronics up 1.6% following a significant 1,458.2% year-on-year rise in second-quarter operating profit. However, the small-cap Kosdaq fell by 0.78%. Australia’s S&P/ASX 200 increased by 1.70%, while Hong Kong’s Hang Seng Index led Asian markets with a 1.9% rise. Mainland China’s CSI 300 also gained nearly 2%. Additionally, China’s securities regulatory commission replaced Vice Chairman Fang Xinghai with Li Ming, its inspection bureau chief, amid reports of Fang’s retirement.
In the U.S., the S&P 500 declined as megacap tech stocks fell, with investors awaiting quarterly reports from these companies. The Federal Reserve’s latest policy meeting also drew attention. Nvidia shares dropped by 7%, Microsoft fell by approximately 0.9%, and other tech giants like Amazon, Netflix, and Meta Platforms also declined. Consequently, the S&P 500 lost 0.5%, the Nasdaq Composite tumbled 1.28%, while the Dow Jones Industrial Average rose by 0.5%.
Upcoming Events:
- 12:15 PM GMT – USD ADP Non-Farm Employment Change
- 12:30 PM GMT – CAD GDP m/m
- 12:30 PM GMT – USD Employment Cost Index q/q
- 6:00 PM GMT – USD FOMC Meeting Minutes
- 6:00 PM GMT – USD Federal Funds Rate
