General Market Analysis 29/03/2024 | IC Markets


US Stocks Close Higher to Lock in Best Quarter 1 for 5 Years

The major US stock indices all closed close to flat on Thursday with the S&P notching up its 22nd record finish this year to close the best quarter’s trading since 2019. The Dow finished 0.12% higher, the S&P 0.11% up and the Nasdaq dropped 0.12% on the day. The dollar edged higher against most of the majors as US data once again exceeded expectations and US treasury yields pushed up, the 2-year jumping 5.2 basis points to 4.622% and the benchmark 10-year edging up 0.6 basis points to 4.202%. Oil prices climbed again as the market factored in OPEC+ production cuts, Brent gaining 1.6% to $87.48 per barrel and WTI rising 2.2% to hit $83.17 per barrel. The star of the show once again though was Gold, which hit fresh record highs, jumping 1.9% on the day.

Gold Outshines All Others to Hit New Record Highs

Gold jumped to fresh all-time highs in trading again yesterday as safe-haven demand and interest rate cut expectations in the US combined to drive prices higher. Volatility has been high in the precious metal over the last few weeks and talk of large portfolio reallocations combined with the Fed pivot has led to strong moves higher. It has been an interesting move to many market commentators as Gold will normally gain ground when markets are risk averse and haven trades are at a premium, but yesterday’s move coincides with another record high in the S&P and while the dollar appreciated against currencies last night it took a big dive against Gold. It was of course quarter end and that adds further credence to the portfolio allocation story, but for now traders are looking to go with the trend and will use any dips as buying opportunities, with support levels like the 200-day moving average which is now around the $2,180 per ounce level initial targets for any pull backs.

Holiday Liquidity and Big Data to End the Week

It could be a very messy day for financial markets today as many centers are closed for Good Friday holidays and one of the most important data prints is due to drop in the New York session. Asian markets are still largely open today and investor focus will be on Japan early in the day for the release of the Tokyo CPI number. There is little on the calendar in the European session due to the holidays, but volatility could rise significantly once the US Day begins. The key PCE Price Index data is due out early in the session and as it is the Fed’s favored inflation indicator, we could see some big moves if it sprints away from the expected 0.3% month-on-month increase. Later in the day, Fed Chair Jerome Powell is set to talk in San Francisco and any further chat of pending rate cuts could see exacerbated moves in thin markets.


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