Powell delivers the central bank’s semi-annual monetary policy report
Wall Street stocks closed mostly lower overnight as investors continued to cautiously monitor rising bond yields. On the data front, the Chicago Fed National Activity Index increased to 0.66 in January from 0.41, the Conference Board’s leading economic indicators index increased 0.5% in January following a rise of 0.4% while the Dallas Fed manufacturing index increased to 17.2 in February from 7.0. As such, the S&P 500 fell 0.77%, the Dow Jones Industrial Average gained 0.1%, and the Nasdaq lost 2.46%. The U.S. House of Representatives is likely to vote on President Joe Biden’s proposed stimulus package by the end of the week.
In Asia, shares were mostly higher, rebounding from two-week lows on Tuesday despite losses on Wall Street. South Korea’s Kospi slipped 0.31% while Australia’s S&P/ASX 200 gained 0.86%. Hong Kong’s Hang Seng jumped 1.03%, while the Shanghai Composite in China shed 0.17%. Japanese markets were closed for a national holiday.
European equities dropped along with U.S. equity futures today as the jump in bond yields continued to hammer shares. Later today, Fed Chair Jerome Powell delivers the central bank’s semi-annual monetary policy report to the Senate Banking Committee. The event could affect investor sentiment in the short term.
Meanwhile, the dollar is mostly higher against major counterparts, with most pairs little changed during the European hours on Tuesday. EURUSD climbed to one-month highs around 1.2180 earlier in the day before retreating amid profit-taking. Still, the technical picture surrounding the common currency has improved somehow as the pair has settled above the 20-DMA while holding above the 1.2100 figure. On the data front, the Eurozone CPI came in at 0.9% on a yearly basis in January, meeting the flash estimate of 0.9% and 0.9% expectations. The core figures arrived at 1.4% versus +1.4% previous and +1.4% expectations. EURUSD held the lower ground around 1.2150 following the release.