Global Stocks Surge as Tech Rally Boosts Markets - ECB Rate Decision in Focus
- forex368 Forex Education
- Sep 12, 2024
- 2 min read
Key Highlights:
Global Stocks Advance: Equity markets in Japan, South Korea, and Taiwan experienced gains as the tech rally continued. European and U.S. markets are expected to follow this upward trend.
Yen Weakens: The Yen retreated after briefly reaching its strongest level since December 2023.
Gold and Oil Rise: Spot gold prices exceeded $2,515/oz while WTI crude rose towards $68/barrel due to Hurricane Francine concerns.
Market Overview:
Dollar Index (DXY): The DXY pulled back towards 101.70, helping commodities like gold gain strength.
Gold (XAU): Spot gold prices climbed above $2,515/oz. Gold's next bias is weak bearish as U.S. inflation data might influence further market moves.
Oil (WTI): Oil surged due to Hurricane Francine threatening production in the Gulf of Mexico. WTI approached $68/barrel.
European Equities: Euro Stoxx 50 futures point to a higher open, tracking the strong performance of Asian markets.
Asian Session Recap:
The session saw a tech-led rebound, especially in Japan and South Korea. The Yen weakened after comments from Bank of Japan officials, while U.S. inflation data helped fuel expectations of a Federal Reserve rate cut next week.
Chinese equities showed mixed performance, reflecting uncertainty regarding the broader economic outlook.
Upcoming Key Events:
European Central Bank (ECB) Rate Decision (1:15 pm GMT): Markets expect a 60 basis points rate cut, reducing the main refinancing rate to 3.65%. President Christine Lagarde's dovish tone could weigh heavily on the Euro.
U.S. Producer Price Index (PPI) (1:30 pm GMT): With previous PPI data easing, further declines could put pressure on the dollar.
U.S. Unemployment Claims (1:30 pm GMT): A forecast of 227K claims signals stability in the labor market, which might provide some support to the dollar.
Market Sentiment:
EUR/USD: The Euro could face further pressure with the anticipated ECB rate cut. Next 24 hours bias: Weak Bearish.
USD/JPY: After briefly touching 140.67, the pair rebounded due to U.S. core CPI data, trading around 142.50. Next 24 hours bias: Weak Bullish.
AUD/USD: The Aussie dollar remained under 0.6700 after the U.S. CPI data. Support and resistance levels for the day are 0.6580 and 0.6750, respectively. Next 24 hours bias: Weak Bearish.
NZD/USD: The Kiwi dollar struggled around 0.6130 after falling on stronger U.S. CPI readings. Next 24 hours bias: Weak Bearish.
Conclusion:
Today's market movements are dominated by anticipation around central bank decisions and U.S. inflation data. Equities are poised to continue their tech-driven rally, while the Yen and the Euro may see further declines.
Traders should keep an eye on the ECB decision and PPI data for potential volatility.
Disclaimer:This report is for informational purposes only and should not be considered as investment advice.
Trading forex and CFDs carries a high level of risk, and you should carefully consider your investment objectives and risk tolerance before entering the market.