Global Markets:
- Asian Stock Markets : Nikkei up 0.6%, Shanghai Composite up 2.25%, Hang Seng up 0.94%, ASX up 0.45%
- Commodities : Gold at $1386.60 (+2.80%), Silver at $15.32 (+2.41%), Brent Oil at $62.78 (+1.55%), WTI Oil at $54.80 (+1.54%)
- Rates : US 10-year yield at 1.984, UK 10-year yield at 0.866, Germany 10-year yield at -0.291
News & Data:
- (NZD) GDP q/q 0.60% vs 0.60% expected
- (USD) Federal Funds Rate <2.50% vs <2.50% expected
- (CAD) Trimmed CPI y/y 2.30% vs 2.00% expected
- (CAD) Median CPI y/y 2.10% vs 1.90% expected
- (CAD) Common CPI y/y 1.80% vs 1.90% expected
- (CAD) CPI m/m 0.40% vs 0.10% expected
- (GBP) PPI Input m/m 0.00% vs 0.20% expected
- (GBP) CPI y/y 2.00% vs 2.00% expected
- Federal Reserve issues FOMC statement
- Gold price at all-time highs as next bull run appears imminent
Markets Update:
Asian markets gained in early trading Thursday, after the U.S. Federal Reserve kept interest rates unchanged but signalled interest rate cuts beginning as early as July. The rally in stocks comes as a host of Asian central banks are scheduled to hold policy meetings later in the day, with most expected to flag moves toward looser monetary settings. There was also encouraging news on the trade front, as U.S. Trade Representative Robert Lighthizer said he plans to meet his Chinese counterpart ahead of the G-20 summit next week. China and the United States returning to the negotiating table after a six-week hiatus also bolstered risk sentiment.
The ASX 200 index has fought back from an earlier decline and has pushed higher on Thursday. ECB President Mario Draghi’s suggestion that his central bank is prepared to inject fresh stimulus into the European economy coupled with President Trump’s interest in meeting Xi Jinping elicited excitement.
Leading the Asian region higher, the Shanghai Composite surged over 2% while Japan’s Nikkei had a good day, rising by 0.6%. Hong Kong’s Hang Seng Index, which has been under severe pressure this quarter, was the best performing Asian index on June 19 while it is trading at a 0.94% gain on June 20.
The bulk of Fed policymakers slashed their rate outlook for the rest of the year by roughly half a percentage point, sending the 10-year U.S. Treasuries yield to as low as 1.974%, its lowest level since November 2016. The dollar fell 0.5% on the yen to hit a five-month low of 107.57 yen extending losses after the Bank of Japan stood pat on policy.
Gold jumped above its long-held resistance around $1,350 per ounce to hit its highest level since September 2013, rising to as high as $1,392.3. Oil prices held firm, ahead of the OPEC meeting on 1st July and underpinned by a larger-than-expected decline in U.S. crude inventories.
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