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Economic Indicators & Central Banks:
- Global Stocks fell ahead of today’s jobs report, which coupled with the rising geopolitical risks and the angst over the FOMC’s rate trajectory triggered a flight to safety, hence boosting the haven demand.
- Treasuries climbed, the US Dollar ended near session highs and Oil rallied.
- Israeli Prime Minister Benjamin Netanyahu said at a security cabinet meeting his country will operate against Iran and its proxies and will hurt those who seek to harm it. President Joe Biden told Netanyahu on a call that US support for his war would depend on new steps to protect civilians.
- Note: A direct conflict between Israel & Iran could restrict further Oil supply and hence could boost Oil above $100.
- Japan: BOJ Governor Ueda stoked bets about an additional interest rate hike later in the year, if the yen’s weakness affected the economy. FM Shunichi Suzuki repeated warnings that the government would take appropriate measures to support the currency. Meanwhile, former top currency diplomat Hiroshi Watanabe said earlier this week that the government likely won’t make a move unless the Yen plunges below 155 per dollar.
Financial Markets Performance:
- The USDIndex has rallied into the close from the session low of 103.92, finishing back at 104.12. But it was over 105 on Monday, the highest since November.
- The Yen extended a rally to hit a 2-week high. The currency experienced its most significant surge against the USD in nearly a month, prompting a retreat from levels that traders had anticipated might trigger intervention.
- Gold: The rising concerns over the situation in the Middle East have boosted haven demand for gold which climbed to another record peak over $2304 per ounce.
- USOIL jumped to $86.70 and UKOIL rose above $91 near its highest since October. Israel has increased preparations for potential retaliation by Tehran after Monday’s strike on an Iranian diplomatic compound in Syria, stoking fears of a wider regional conflict. OPEC kept global markets tight.
- Copper holds at 14-month highs.
Market Trends:
- Wall Street had a tough session and closed with steep losses of over -1%. The recent record peak on stocks have left the market ripe for profit taking too ahead of jobs.
- The NASDAQ dropped -1.4% and the Dow tumbled -1.36% with the S&P500 slumping -1.23%. Every S&P sector closed with a loss, with only energy preventing a complete rout in the Dow.
- Nikkei drifted more than 2% putting it on course for its worst week since December 2022 as tech shares slid on Wall Street’s lead. – The biggest driver for the Nikkei’s dip is technical.
Click here to access our Economic Calendar
Andria Pichidi
Market Analyst
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