Market participants wait for signs of interest rate plans from this week’s Fed conference
Wall Street equities were mostly higher at the start of the week, with the S&P 500 index snapping a four-day losing streak due to a rise in tech stocks, which advanced despite a climb in Treasury yields that reached their highest level since November 2007. The index added nearly 0.7%, the Dow gave up 0.1% and the Nasdaq Composite jumped 1.7% to post its biggest advance of the month. Investors are now anticipating Fed Chairman Jerome Powell’s remarks at Jackson Hole on Friday for more indication about the central bank’s forward path on interest rates.
In Asia, stocks advanced on Tuesday as market participants waited for signs of interest rate plans from this week’s Fed conference. The Shanghai Composite Index rose 0.88% and Tokyo’s Nikkei 225 advanced 1.05%. The Hang Seng in Hong Kong gained 1.03%, the Kospi in Seoul added 0.28% and Sydney’s S&P-ASX 200 was just 0.1%. Still, concerns over slowing growth in China still weighed on sentiment in the region, especially after a disappointing interest rate cut from the People’s Bank on Monday.
European stock markets opened higher today after modest gains to start the week. The Stoxx 600 index was 0.68% higher in early deals, with technology stocks leading the pack, gaining more than 1.7%. In individual stocks, French gaming firm Ubisoft Entertainment was more than 6% higher after Microsoft unexpectedly submitted to UK regulators a new deal for the takeover off Activision Blizzard. Meanwhile, US stock index futures nudged lower in early pre-market deals.
Meanwhile, the US dollar keeps retreating, staying under selling pressure for the fourth session in a row. The USD index derailed the 200-DMA, threatening the 103.00 psychological level now even as Treasury yields stay elevated. Should the greenback fail to hold above this figure, the 102.80 immediate support will come back into the market focus. It looks like the dollar could see more losses in the near term as traders nervously await Powell’s speech at Jackson Hole later in the week. A lack of hawkish tone from the Fed governor would put the buck under more intense pressure ahead of the weekend.
