2023-10-10 16:27:34
In Asia, the Nikkei 225 exploded by 2.4% in Tokyo. The Hang Seng gained 0.8% in Hong Kong. (Photo: The Canadian Press)
MARKET REVIEWS. Encouraging news on interest rates propelled global markets Monday morning, following a rather positive week on Wall Street.
Stock market indices at 8:00 a.m.
London, Frankfurt et Paris advanced around 1.5% at the start of the session in Europe.
HAS New Yorkbefore the markets open, the Dow Jones industrial average and the broad index S&P 500 increased by 0.2%.
In Asia, the Nikkei 225 exploded by 2.4% to Tokyo. The Hang Seng took 0.8% to Hong Kong. Sydney added 1% and Seoul lost 0.3%.
On the New York Commodity Exchange, the price of oil dropped 9 US cents to US$86.29 per barrel.
The context
On Monday, Wall Street finally progressed following an early session in the red, held back by fears arising from the conflict between Israel and Hamas.
But the main movement on the markets on Tuesday was the clear decline in American interest rates, which were not quoted on Monday due to a public holiday.
The interest rate on the American 10-year bond fell by almost 15 basis points, from 4.802% to 4.657%, a movement not seen since March if it is maintained until the close.
This fall is linked to “comments” from members of the American Central Bank on Monday, according to Ipek Ozkardeskaya, analyst at Swissquote Bank.
“Lorie Logan, president of the Dallas branch of the US Central Bank, said the recent rise in long-term US bond yields might mean there is less need for further tightening by the Fed,” explains – she said.
The possibility of a further increase in key rates from the American Central Bank in November, as well as their maintenance at a high level for many months in order to fight inflation, had caused a surge in rates in recent weeks.
The investors’ agenda is poor in indicators on Tuesday, but the market is focused on Thursday and the publication of American inflation (CPI indicator) for September.
Investors also continue to observe the continuation of the conflict triggered by Hamas once morest Israel, and whose “evolution is extremely uncertain”, relates François Rimeu, member of the strategy team of Française AM, and particularly on oil.
The main index of the Israeli Stock Exchange was up slightly on Tuesday (+0.36%), just like on Monday following experiencing its worst session since March 2020 on Sunday (-6.47%).
Country Garden close to default
Overindebted Country Garden, one of China’s largest real estate groups, announced Tuesday that it may not be able to repay all its loans, increasing the risk of default.
This situation would be catastrophic for this key sector of the Chinese economy, which has long represented a quarter of its gross domestic product in the broad sense.
The stock fell 8.33% in recent trading in Hong Kong, and has fallen more than 70% over the year.
Breathing on oil
After gaining more than 4% on Monday, their strongest increase since May, oil prices were slowing down a little.
A barrel of North Sea Brent fell 0.79% to 87.45 US dollars ($US), and American WTI fell 0.82% to 85.67 US$ around 3:00 a.m.
The sharp rise in oil prices boosted the stock market shares of oil companies on Monday and once more on Tuesday in Japan with Idemitsu Kosan (+5.36%) and Eneos Holdings by 5.21%.
The euro remained stable once morest the dollar (-0.04%) at US$1.0563 per euro.
Bitcoin gained 0.32% to US$27,665.
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