The dollar strengthened as European equities and US futures fluctuated as investors focused on the Federal Reserve and the European Central Bank’s comments on monetary stimulus prospects.
In Europe, member of the governing council Francois Villeroy de Galhau He said the ECB would maintain a light stance for as long as necessary, and US investors were reassured by remarks by two Federal Reserve officials who pushed back the possibility of a reduction in bond purchases soon.
James Bullard, president of the Federal Reserve Bank of St. Louis said eliminating the pandemic remains a political priority, a sentiment echoed by Boston Fed chief Eric Rosengren. This allayed concerns that the Fed could be geared towards repeating the so-called tantic tantrum in 2013, when the withdrawal of the monetary stimulus triggered volatility in financial markets.
“Coordinated comments from Fed governors” help deflate bond yields, Deutsche Bank AG strategists, including Jim Reid, said in a note to customers. “We’ve only had seven business days this year, and we’ve already had a full 360-degree debate by the Fed.”
The Stoxx 600 in Europe was flat, with losses in banks and travel stocks exceeding M&A ads.
Among the winners of the day, the French grocer Carrefour SA gathered 10% after Alimentation Couche-Tard Inc., the store giant that owns the Circle K chain, said it was exploring a transaction. Telefonica SA also increased by 10% after American Tower Corp. said it would buy telecommunications towers in Europe and Latin America from the company.
General Motors Co. added 3.6% to US pre-market trading. On Tuesday, GM announced plans to enter electric vehicles by creating a wholly owned company called BrightDrop, which will provide battery-powered trucks and provide fleet management services.
In Japan, the Nikkei 225 outperformed, hitting a record in dollar terms. Shares also ticked in South Korea, while shares in Hong Kong were fixed.
In the future, New York oil rose for the seventh session, to $ 54 a barrel in the longest earnings period since February 2019. The combination of an industry report indicating another decline in U.S. crude oil stocks, the cuts Saudi Arabia’s output and a weaker dollar are all leading to rising energy prices.
Here are some key events that occur:
- JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co., as well as companies ranging from Taiwan Semiconductor Manufacturing Co. by Infosys Ltd., is among those due to earnings reporting.
- The EIA crude oil inventory report is set to be released on Wednesday.
- Christine Lagarde, European Central Bank, speaks online conference on wednesday.
- US consumer price inflation figures are due on Wednesday.
- US President-elect Joe Biden intends to settle down proposals for tax support on Thursday.
- Federal Reserve Chairman Jerome Powell attends a webinar joi.
- Initial US unemployment claims are expected on Thursday.
- US retail sales, industrial production, business inventories and consumer sentiment the numbers are coming.
These are some of the main movements in the markets:
Inventories
- The future S&P 500 indices changed slightly at 10:56 London time.
- Stoxx Europe 600 Index has been slightly modified.
- The MSCI Asia Pacific Index rose 0.5%.
- The MSCI emerging market index rose 0.5%.
currencies
- The Bloomberg Dollar Spot index rose 0.2% to 1,122.20.
- The euro fell 0.2% to $ 1.2179.
- The pound rose 0.1% to $ 1.3672.
- The Japanese yen weakened 0.2% to $ 103.94.
BONDS
- The 10-year Treasury yield fell one basis point to 1.12%.
- The two-year Treasury yield rose less than one basis point to 0.15%.
- Germany’s 10-year yield fell three basis points to -0.49%.
- The 10-year British yield fell by two basis points to 0.335%.
commodities
- West Texas Intermediate Oil gained 0.2% to $ 53.36 a barrel.
- Gold rose 0.1% to $ 1,855.23 an ounce.
– With the assistance of Steve Matthews and Vivien Lou Chen