Global Markets:
- Asian Stock Markets : Nikkei down 1.68%, ASX up 0.02%
- Commodities : Gold at $2042.95 (+0.23%), Silver at $25.06 (-0.17%), Brent Oil at $85.19 (+0.29%), WTI Oil at $80.86 (+0.19%)
- Rates : US 10-year yield at 3.359, UK 10-year yield at 3.481, Germany 10-year yield at 2.266
News & Data:
- (NZD) Official Cash Rate 5.25% vs 5.00% expected
- (USD) JOLTS Job Openings 9.93M vs 10.49M expected
- (AUD) Cash Rate 3.60% vs 3.60% expected
Markets Update:
Asian markets were mixed on Wednesday as investors weighed the impact of surging oil prices on inflation and growth against signs of a slowing US economy that could ease the pressure on the Federal Reserve to tighten monetary policy.
Oil prices extended their gains after OPEC and its allies announced a surprise output cut of more than a million barrels a day over the weekend, sending Brent crude above $80 a barrel for the first time since 2014. The move boosted energy stocks but also raised concerns about higher costs for consumers and businesses, especially in oil-importing countries.
New Zealand’s central bank delivered another shock to the markets by raising its benchmark interest rate by 50 basis points to 5.25%, the highest level since October 2008. The move was aimed at curbing inflationary pressures and cooling down the overheated housing market, but also sent the New Zealand dollar soaring by nearly 0.9% against the US dollar.
The US dollar index, which measures the greenback against a basket of major currencies, fell 0.2% to 93.8, while gold prices rose 0.4% to $1,777 an ounce as investors sought safe-haven assets. Crude oil futures also gained 0.4% to $81.2 a barrel.
In Asia-Pacific equities, Japan’s Nikkei 225 led losses in the region, falling 1.01%, while the Topix index dropped 1.32%. The Japanese yen strengthened 0.3% to 109.9 per dollar, adding pressure on exporters. Japan’s services sector expanded for the seventh straight month in March, but at a slower pace than in February. Australia’s S&P/ASX 200 index slipped 0.1%, as gains in energy and mining stocks were offset by losses in financials and consumer discretionary sectors. New Zealand’s S&P/NZX 50 index erased earlier gains and closed 0.13% lower, as higher interest rates weighed on growth-sensitive sectors such as utilities and industrials. Mainland China and Hong Kong markets were closed for a holiday.
Upcoming Events:
- 12:15 PM GMT – (USD) ADP Non-Farm Employment Change
- 02:00 PM GMT – (USD) ISM Services PMI
