(Bloomberg) — European and U.S. stock futures rose ahead of much-anticipated U.S. inflation data that will help determine when the Federal Reserve will finally ease monetary policy.
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The Stoxx Europe 600 rose 0.6%, led by energy, basic resources and technology stocks. UK stocks outperformed as figures showed the jobs market was cooling. S&P 500 and Nasdaq 100 futures rose 0.4% and 0.7%, respectively. US Treasury yields were stable and the dollar exchange rate was flat.
Citigroup says the options market is more worried about the S&P 500’s big swings after the inflation report than about next week’s Fed interest rate decision. Traders say they are hedging against a 0.9% move in either direction, the largest implied change going forward. Consumer Price Index Report from April 2023 onwards.
Composite CPI is likely to accelerate, while core indicators are expected to slow slightly, according to Bloomberg Economics.
“Ultimately, we do not expect February’s CPI report to provide enough clear evidence of disinflation to give the Fed confidence in rate cuts,” Bloomberg economists Anna Wong and Stuart Paul wrote in a note. said. “But they can have plenty of confidence in May.”
Meanwhile, the Hang Seng Tech Index, which tracks Chinese technology stocks listed in Hong Kong, became the latest index in a battered market to rise 20% from recent lows.
Elsewhere, sterling fell as data showed an unexpected rise in unemployment and a slowing pace of pay rises, allaying Bank of England concerns about inflationary forces. The benchmark FTSE 100 rose 0.9% and gold yields fell.
The yen weakened for the first time in six days after Bank of Japan Governor Kazuo Ueda pointed to some weakness in consumption of non-durable goods and also indicated that the Bank of Japan remains on track to end its negative interest rate policy. It fell to The Bank of Japan will make its next policy decision on March 19th.
“We expect the BOJ to end its negative interest rate policy in April as it wants to digest more data,” Malayan Banking strategists led by Saktyandi Supaat said in a research note. . “If the BOJ is disappointed in its exit decision at its next March meeting, USD/JPY could rise, and we see an opportunity to sell USD/JPY on the upside.”
Japan’s 10-year bond yield rose to its highest level in three months following current reports that the Bank of Japan will lift negative interest rates at next week’s meeting if the wage data is positive.
In commodities, oil edged higher as traders awaited OPEC’s monthly report and industry data on U.S. stockpiles. Gold has fallen from all-time highs. Bitcoin held just above $72,000 after surpassing that level for the first time on Monday.
This week’s main events:
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UK Monetary Policy Committee quarterly meeting attended by Bank of England Governor Andrew Bailey on Tuesday
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EU finance ministers meet in Brussels on Tuesday
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ECB Executive Board Member Robert Holzmann, Tuesday
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US Consumer Price Index, Tuesday
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Eurozone industrial production, Wednesday
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ECB Executive Board member Giannis Stournaras speaks on Wednesday
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Volkswagen, Adidas financial results, Wednesday
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US PPI, Retail Sales, New Unemployment Insurance Claims, Business Inventories, Thursday
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Chinese real estate prices Friday
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Japan’s largest trade union federation announces results of annual wage negotiations on Friday ahead of Bank of Japan policy meeting
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Bank of England releases inflation survey on Friday
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US Industrial Production, University of Michigan Consumer Sentiment, Empire Manufacturing, Friday
The main movements in the market are:
stock
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As of 8:06 a.m. London time, the Stoxx European 600 was up 0.6%.
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S&P 500 futures rose 0.4%
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Nasdaq 100 futures rose 0.7%
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Dow Jones Industrial Average futures rose 0.2%.
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MSCI Asia Pacific Index rose 0.3%
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MSCI Emerging Markets Index rose 0.9%
currency
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Bloomberg Dollar Spot Index little changed
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The euro was almost unchanged at $1.0931.
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The Japanese yen fell 0.3% to 147.46 yen to the dollar.
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The offshore yuan remained unchanged at 7.1799 yuan to the dollar.
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The British pound fell 0.2% to $1.2794.
cryptocurrency
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Bitcoin fell 0.1% to $72,036.01.
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Ether fell 0.3% to $4,021.57.
bond
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The 10-year government bond yield was almost unchanged at 4.09%.
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German 10-year bond yield remains unchanged at 2.30%
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UK 10-year bond yields fell 2 basis points to 3.95%.
merchandise
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Brent crude rose 0.6% to $82.67 per barrel
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Spot gold fell 0.3% to $2,177 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Michael G. Wilson, Ruth Carson, and Jason Scott.
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