Morning Note: A round-up of today's market news.
Market News
Gold continued to break new highs and currently trades at $2,652 an ounce. This followed data indicating a more significant drop in US consumer confidence than anticipated, reinforcing a dovish perspective for the Fed and aligning with the policymakers’ earlier signals of another interest rate reduction. Swaps traders raised their wagers to about 75 bps of Fed easing by year-end — implying a half-point move at one of the two remaining meetings. Next up is the PCE reports, the Fed’s preferred inflation gauge. The 10-year currently yields 3.73%.
US equities also pushed higher last night – S&P 500 (+0.3%); Nasdaq (+0.6%) – with chemicals and industrial metals among best performers on China stimulus. Visa fell by 5% following the launch of a DOJ lawsuit accusing the company of anti-trust violations in the debit card market. Visa described the complaint as “meritless” and vowed to “vigorously” defend itself.
In Asia this morning, equities also rose – Hang Seng (+0.8%); Shanghai Composite (+1.3%) – as a rally fuelled by China’s wide-ranging stimulus package lifted equities for a second day and strengthened the yuan, which pushed past 7 against the dollar for the first time since May 2023. The Nikkei 225 fell by 0.2%.
The FTSE 100 is currently trading 0.2% lower at 8,258, while Sterling trades at $1.3395 and €1.1969. Rightmove has rejected the latest offer from REA Group. The increased proposal was 341p in cash and 0.0422 new REA shares for each Rightmove share. Based on last night’s closing price of REA, the revised proposal implied an offer value of 759p. This morning the shares are trading at 680p.
US crude inventories fell by 4.34m barrels last week, the API is said to have reported. That would take total holdings to the lowest since 2022 if confirmed by the EIA today. Meanwhile, OPEC doubled down on forecasts that global oil demand will keep growing roughly 18% to 120.1m barrels a day by 2050, an outlier view that scientists say would lead to climate catastrophe. Brent Crude currently trades at $74 a barrel.
Source: Bloomberg