Asian stock markets and the U.S. dollar struggled for traction on Friday after a rush of central bank meetings underlined the growing threat posed by a spike in global inflation, while fears about the omicron variant of COVID-19 added to a cautious mood.
The dollar index was trading at 95.999, off nearly 1% since Wednesday’s high immediately after the Federal Reserve announced it would accelerate tapering of its emergency bond buying programme and prepare to raise rates more quickly next year.
The yield on benchmark 10-year Treasury notes was at 1.4275%, the lower end of their recent range, while the two-year yield, was at 0.6330% also having rolled off its recent highs. [US/]
“Ordinarily, in the wake of a more hawkish FOMC outcome, yields would be expected to rise in anticipation of the Fed tightening cycle,” said analysts at Westpac in a morning note, referring to the Federal Open Market Committee, which sets monetary policy.
“However there are competing dynamics at present, with ongoing inflation fears sparking the Fed’s tougher rhetoric being offset by fears that economic growth will be derailed by omicron in the near term,” they said.
The Fed was the centrepiece of a busy week for central bank policy makers, many of which took a more hawkish turn.
Also hurting the dollar were gains in the pound, which rose 0.45% on Thursday after the Bank of England surprised markets by becoming the first major global central bank to raise interest rates – hiking by 0.15 percentage points to 0.25%. [FRX/]
The euro firmed after the European Central Bank took another small step to roll back crisi-era stimulus.
The Bank of Japan will wrap up a bumper week for major central banks later on Friday. It is set to keep monetary policy ultra-loose but may dial back emergency pandemic-funding.
SINO-U.S. TENSIONS
Share markets have failed to find a clear direction since the Fed meeting. Overnight the Nasdaq ended sharply lower as investors moved away from growth stocks like big tech and towards value names, pushing the S&P 500 value index up 0.7%. [.N]
Japan’s Nikkei was 0.85% lower in early trading on Friday after rising 2.13% the day before in its best day in nearly seven weeks. [.T]
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 0.2%. It is heading for a weekly decline of 1.7%, and at 621.93 is only just above the year low of 615.99 set last week.
Chinese stocks, particularly tech names, have been a major drag, with the Hong Kong benchmark touching its lowest level since September 2020 on Thursday, and falling 0.56% on Friday.
Kenny Ng, securities strategist at Everbright Sun Hung Kai said the softness was due to renewed investor attention on tense Sino-US relations.
“Recently, a number of new companies in the United States have been added to the sanction list, which has an impact on related shares and even market sentiment. It is expected that the Hong Kong stock market will continue to consolidate before the end of the year,” he said.
The U.S. government put investment and export restrictions on dozens of Chinese companies on Thursday, including top drone maker DJI, accusing them of complicity in the oppression of China’s Uyghur minority or helping the military, further ratcheting up tensions between the world’s top two economies. [nL1N2T11DU]
Oil prices slid in early Friday trading after rising 2% the day before. Brent crude falling 0.6% to $71.94 a barrel and U.S. crude losing 0.6% to $71.94 a barrel. [O/R]
Spot gold was little changes, off 0.07% at $1,797 an ounce. [GOL/]
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
