Trading Tuesday
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Market Data
Local
Global
*Data as of 4pm WAT
Market News
Local
Global
Market Commentary:
Currencies/Macro:
The US dollar index increased by 0.2%, reaching a six-month high following stronger-than-expected US retail sales, which reinforced the narrative of resilient US growth and prolonged higher interest rates. The ongoing hostilities in the Middle East also supported the safe-haven appeal of the USD.
EUR dropped from 1.0665 to a six-month low of 1.0622. USD/JPY climbed from 153.80 to a 34-year high of 154.45, indicating underperformance by the yen.
US retail sales for March increased by 0.7% month-over-month, surpassing the expected 0.4% and following a revised prior increase of 0.9%. Excluding autos and gas, sales grew by 1.0%, and the core control group saw a rise of 1.1%.
The New York Fed manufacturing survey showed further contraction, dropping from -20.9 to -14.3, missing the expected -5.0, with noted increases in both prices paid and received.
Homebuilder confidence as measured by the NAHB index remained stable at 51, aligning with market expectations.
Eurozone industrial production in February increased by 0.8% month-over-month but showed a year-over-year decline of 6.4%, which was softer than the expected -5.5%.
Interest Rates:
The US 2-year Treasury yield decreased from 4.92% to 4.86%, settling at 4.90%, while the 10-year yield dropped from 4.56% to 4.48%, currently at 4.52%.
Market expectations remain for the Federal funds rate, set at 5.375% (mid), to hold steady at the next meeting on May 2nd, with a 60% probability of a rate cut in July.
In credit markets, the CDX IG index widened by 1.9 bps to 54.78 bps. Boeing and Expedia were among the best performers, whereas Ally Financial and DXC Technologies negatively impacted the index.
Cash bonds saw a tightening of 2.3 bps to 120.5. Utilities and industrials were the top-performing sectors, while subordinated financials and communications lagged behind.
Commodities:
Industrial commodity prices are experiencing significant increases, notably aluminium which surged on the London Metal Exchange (LME) by up to 9.4% in a single session, responding to new US and UK sanctions that restrict Russian supply. Although the price later moderated, aluminium has climbed 15% over the past month.
Copper also reflects robust gains, rising nearly 10% over the same period, influenced both by geopolitical factors and positive economic indicators as Purchasing Managers' Indexes (PMIs) enter expansion territory in key global regions since the start of the new year.
Iron ore prices have strengthened, currently at $111.85 per ton, up from levels below $100 earlier in the month.
Gold continues its upward trajectory, reaching $2386 per ounce, as investors seek safe-haven assets amidst escalating geopolitical tensions in the Middle East.
Investment Tip of The Day
Regularly update your financial literacy to enhance your ability to analyze and understand market trends and investment products. Staying informed about financial concepts and market mechanics can empower you to make more educated decisions, potentially leading to better investment outcomes. This ongoing education is crucial, especially as financial markets evolve and new investment opportunities and risks arise.