Global Markets:
- Asian Stock Markets : Nikkei up 0.90%, Shanghai Composite down 1.12%, Hang Seng down 0.67%, ASX up 0.07%
- Commodities : Gold at $2011.10 (-0.47%), Silver at $24.07 (-1.44%), Brent Oil at $74.52 (-0.61%), WTI Oil at $70.50 (-0.52%)
- Rates : US 10-year yield at 3.408, UK 10-year yield at 3.765, Germany 10-year yield at 2.244
News & Data:
- (GBP) Prelim GDP q/q 0.10% vs 0.10% expected
- (GBP) GDP m/m -0.30% vs 0.00% expected
- (NZD) Inflation Expectations q/q 2.79% vs 3.30% previous
- (USD) 30-y Bond Auction 3.74|2.4 vs 3.66|2.4 previous
- (USD) Unemployment Claims 264K vs 245K expected
- (USD) PPI m/m 0.20% vs 0.30% expected
- (USD) Core PPI m/m 0.20% vs 0.20% expected
- (GBP) Official Bank Rate 4.50% vs 4.50% expected
- (GBP) MPC Official Bank Rate Votes 7-0-2 vs 7-0-2 expected
- (CNY) New Loans 719B vs 1400B expected
Markets Update:
Asian equity markets closed mixed on Friday, as investors weighed the impact of rising inflation and the troubles of some US banks on the global economic outlook. The region’s major driver of growth, China, also showed signs of slowing demand, as its inflation data came in lower than expected.
Japan’s Nikkei 225 was the best performer among the major indices, gaining 0.9% to finish at 29,388.30, boosted by upbeat earnings from some automakers and tech firms. Nissan Motor Co. rose 4.5% after reporting a smaller-than-expected annual loss and forecasting a return to profit this fiscal year. SoftBank Group Corp., however, slumped 7.3% after posting its second consecutive year of losses, dragged down by its Vision Fund investments.
Australia’s S&P/ASX 200 edged up nearly 0.1% to 7,256.70, as gains in energy and mining stocks offset losses in financials and consumer staples. Oil and gas producer Woodside Petroleum Ltd. climbed 3.2% after announcing a deal to sell a stake in one of its liquefied natural gas projects to a Japanese consortium.
South Korea’s Kospi dropped 0.7% to 2,473.48, as chipmakers and biotech firms dragged the index lower. Samsung Electronics Co. fell 1.4% and Celltrion Inc. declined 2.9%. Hong Kong’s Hang Seng slipped 0.5% to 19,641.04, while the Shanghai Composite dove nearly 1.0% to 3,277.64, as investors digested disappointing inflation data from China.
China’s consumer price index rose 1.3% year-on-year in April, missing market expectations of a 1.5% increase and easing from a 2.4% rise in March. The producer price index jumped 6.8% year-on-year in April, the fastest pace since October 2017 and above market forecasts of a 6.5% increase.
The inflation data added to concerns about China’s economic recovery losing steam, as credit growth slowed and consumer spending remained subdued. Analysts said the central bank may keep its policy stance unchanged for now, but may have less room for further easing.
Meanwhile, oil prices fell on Friday, set for their fourth weekly decline, as renewed economic concerns in the US and China revived anxieties about fuel demand growth in the world’s two largest oil consumers. Brent crude futures shed 0.3% to $75.36 a barrel, while West Texas Intermediate futures lost 0.6% to $71.31 a barrel. Oil prices were pressured by a surprise increase in US crude inventories last week, as well as reports that some US banks were facing losses from their exposure to a troubled hedge fund.
On the other hand, gold prices ticked down on Friday as the dollar held firm, although persistent economic fears and the US debt ceiling standoff cushioned bullion’s further decline. Spot gold fell 0.3% to $2,010.29 per ounce, while US gold futures dropped 0.3% to $2,015 per ounce. Gold prices were supported by worries about the US fiscal situation, as lawmakers failed to reach an agreement on raising the debt limit before it expires on May 16.
The US Treasury Department said it would use “extraordinary measures” to avoid defaulting on its obligations, but warned that it may run out of cash by July or August if Congress does not act soon.
Upcoming Events:
- 02:00 pm GMT – (USD) Prelim UoM Consumer Sentiment
- 02:00 pm GMT – (USD) Prelim UoM Inflation Expectations
