Recoiling oil and dollar sow calm as tech earnings loom
A look at the day ahead in U.S. and global markets from Mike Dolan
A sharp retreat in oil prices and a rare joint warning from major economies against excessive dollar strength have helped calm restive markets just as Big Tech earnings start to hit.
A volatile start to April looked like getting out of hand this week as a combination of stern Federal Reserve warnings about stubborn inflation and geopolitical stress sent the dollar rocketing and seeded four straight daily losses for Wall St stocks.
But there's been some respite into Thursday's session.
Despite the Middle East tensions and punchy U.S. economic readouts, U.S. crude prices Clc1 turned tail and have now recoiled some 6.5% from Friday's 2024 highs to levels last seen before Israel's attack on Iran's Syrian consulate on April 1.
Surging U.S. crude inventories, poor economic numbers from China for March and a U.S. warning about releasing more of its Strategic Petroleum Reserve if necessary have all reined in oil.
And it's retreat eases at least some of the inflation anxiety irking bond markets and the Fed and U.S. Treasury yields have fallen back in tandem. Having briefly topped 5% this week, two-year Treasury yields US10YT=RR have dropped 10 basis points since.
The dollar .DXY, similarly, has come off the boil - partly after a warning shot from Japan, South Korea and the United States about potentially destabilising currency moves in Asia.
With markets keeping an eye on G7 and G20 finance chiefs in Washington at the International Monetary Fund meetings, the rare three-way statement agreed to "consult closely" on FX markets, acknowledging concerns from Tokyo and Seoul over their currencies' recent sharp declines.
The dollar/yen JPY= pair fell back slightly from 34-year highs, although it remains stuck above 154, and South Korea's won KRW= backed away from its weakest in almost 18 months.
Easing market concerns that China may allow its yuan CNH= to weaken into a competitive regional exporting scramble too, China's deputy central bank governor Zhu Hexin separately on Thursday restated Beijing's "determination in keeping the yuan exchange rate basically stable."
The steadier bond and currency complex helped soothe edgy stock markets around the world as first quarter corporate earnings stream in and attention switches to major tech sector updates.
After Dutch chip equipment firm ASML ASML.AS skidded more than 7% on its earnings miss on Wednesday, there was better news today from Taiwan's chipmaking giant TSMC 2330.TW as it reported a beat that rides the wave of demand related to the artificial intelligence boom.
Streaming firm Netflix NFLX.O kicks off the U.S. Big Tech reporting season later on Thursday.
The upshot is U.S. stock futures are slightly firmer ahead of the bell today, but the VIX .VIX volatility gauge remains elevated above 18 after the four daily losses for the S&P500 in a row and cumulative losses of almost 5% from the record high set late last month.
Financial stocks have had a rough week, with heavy earnings-related share price swoons for Travelers TRV.N and U.S. Bancorp USB.N on Wednesday.
In the central banking world, the Fed warnings this week about keeping interest rates restrictive for longer were not matched by its European peers.
European Central Bank Vice President Luis de Guindos said the ECB has made it "crystal clear" that interest rates could be cut in June - even if policy decisions beyond that remain up in the air.
Elsewhere, Bitcoin BTC= steadied after a one-month slide of almost 20% took it to 6-week lows below $60,000 on Wednesday - with this weeks 'halving' event seen as largely priced in already.
Key diary items that may provide direction to U.S. markets later on Thursday:
* US corporate earnings: Netflix, Blackstone, Comerica, PPG, Intuitive Surgical, DR Horton, March & McLennan, Snap-On, KeyCorp, Elevance Health, Genuine Parts
* Philadelphia Federal Reserve's April business survey, US March existing home sales, weekly jobless claims
* G20 finance ministers and central bankers gather at International Monetary Fund's Spring meeting in Washington
* New York Federal Reserve President John Williams, Fed Board Governor Michelle Bowman and Atlanta Fed chief Raphael Bostic speak; European Central Bank vice-president Luis de Guindos presents ECB annual report to European Parliament, ECB policymakers Isabel Schnabel Mario Centeno, Gediminas Šimkus and Boris Vujcic all speak; Bank of England policymaker Megan Greene speaks
* US Treasury sells 5-year inflation-protected notes, 4-week bills
U.S. government bonds have wiped out all of 2023's gains https://reut.rs/3Uao6cG
Fed's preferred inflation gauge likely kept steady in March https://reut.rs/3xHDo0P
Netflix ad-tier revenue in U.S. set to hit nearly a billion in 2024 https://reut.rs/3vLmSfM
Oil's ups and down since 2020 https://reut.rs/3VVA1xm
By Mike Dolan, editing by Kirsten Donovan; mike.dolan@thomsonreuters.com
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
