Market Monitoring and Performance
Investors are paying close attention to various factors on Thursday. These include the latest policy decision from the Indonesian central bank, consumer price inflation, trade figures from Hong Kong, and producer price inflation data from South Korea.
Early in the Asian trading day, MSCI’s broadest index of Asia-Pacific shares, excluding Japan, experienced a 0.6% decline. This followed the sharp fall in U.S. stocks during the previous session. On the other hand, U.S. stock futures, specifically the S&P 500 e-minis, saw a 0.17% increase. Australian shares dropped by 0.4%, and Japan’s Nikkei stock index slid 1.49%. China’s blue-chip CSI300 index remained stable in early trade but is experiencing the possibility of its worst weekly performance in 12 years and fifth consecutive monthly loss.
Hong Kong’s Hang Seng index opened with a decline of 0.86%.
Wall Street and Treasury Yields
Wall Street experienced a sudden downturn in the middle of the afternoon, ending its impressive rally. The three major U.S. stock indexes, which had reached or were near record highs earlier in the week, closed 1.3% to 1.5% lower than Tuesday’s close. The Dow Jones Industrial Average fell by 1.27%, the S&P 500 lost 1.47%, and the Nasdaq Composite dropped by 1.5%.
As for U.S. Treasuries, the yield on benchmark 10-year Treasury notes fell to 3.8603% compared to Wednesday’s close of 3.877%, reaching its lowest point in almost five months due to falling government bond yields globally after the release of British inflation data. The two-year yield, which typically rises alongside traders’ expectations of higher Fed fund rates, touched 4.3503% compared to a U.S. close of 4.369%.
Currencies and Commodities
In terms of currencies, the dollar index, which measures the greenback against a basket of major trading partner currencies, stood at 102.38. The dollar did strengthen against sterling following the release of British inflation data, fueling speculation of rate cuts by the Bank of England. Sterling, however, traded at $1.2644, a 0.06% increase on the day, while the euro rose by 0.1% to $1.0949.
Within the commodities market, Brent crude, the global oil benchmark, hovered just above $80 a barrel due to concerns over disruptions in global trade and geopolitical tensions in the Middle East following attacks on ships in the Red Sea by Yemen’s Iran-aligned Houthi forces. Brent crude was trading at $79.70 per barrel, while U.S. crude dipped 0.81% to $73.62 a barrel.