Stocks subdued as market seeks catalysts

Stocks subdued as market seeks catalysts
It's a short week for many regions due to Easter weekend.
MAR 27, 2024

European stocks dipped ahead of fresh data for the euro zone as investors sought catalysts to push the market higher. The yen rebounded after touching its lowest level versus the dollar since 1990 amid growing intervention bets.

Europe’s benchmark Stoxx 600 Index edged 0.1% lower before the consumer and economic confidence data. Clothing retailer Hennes & Mauritz jumped as much as 14% after its profit beat estimates thanks to cost cuts, while payments firm Adyen NV got a boost from a broker upgrade. US futures gained 0.3%.

Stocks have had a strong start to the year, with major benchmarks scaling record levels. The S&P 500 is set for its fifth month of straight gains, while Japan’s Nikkei 225 Index of shares closed within a whisker of its all-time high. Still, moves this week have been modest ahead of Friday’s release of the Federal Reserve’s preferred inflation gauge. 

The yen pared losses as intervention wagers rose on a Reuters report that Japanese officials are set to meet. Policymakers are running out of choices short of purchasing the currency to prop it up after the Bank of Japan’s first interest rate hike since 2007 failed to change its trajectory.

“The BOJ’s finger will be on the trigger for FX intervention,” said David Forrester, Singapore-based senior FX strategist at Credit Agricole. 

Treasuries steadied after rebounding from session lows on Tuesday following a $67 billion sale of five year-notes. The dollar was slightly stronger against its Group-of-10 peers, while the offshore yuan weakened.

Shares retreated in China and Hong Kong, with technology companies accounting for the majority of the losses. The decline came as the region’s AI-linked companies mirrored the overnight fall in Nvidia’s shares, and as Alibaba’s plan to shelve listing of its logistics arm soured sentiment.

In US premarket trading, Merck & Co Inc. rose after its Winrevair drug won US approval. Shares in Trump Media & Technology were set to extend gains following its debut as a public company.

Oil extended a decline after an industry report pointed to a sizable build in US inventories, and wider markets struck a weaker tone ahead of the end of the quarter. Gold steadied close to its record high.

Key events this week:

  • Bank of England issues financial policy committee minutes, Wednesday
  • Eurozone economic confidence, consumer confidence, Wednesday
  • Fed Governor Christopher Waller speaks, Wednesday
  • UK GDP revision, Thursday
  • US University of Michigan consumer sentiment, initial jobless claims, GDP, Thursday
  • Japan unemployment, Tokyo CPI, industrial production, retail sales, Friday
  • US personal income and spending, PCE deflator, Friday
  • Good Friday. Exchanges closed in US and many other countries in observance of holiday. US federal government is open.
  • San Francisco Fed President Mary Daly speaks, Friday
  • Fed Chair Jerome Powell speaks, Friday

Some of the main moves in markets:

Stocks

  • The Stoxx Europe 600 fell 0.1% as of 9:36 a.m. London time
  • S&P 500 futures rose 0.3%
  • Nasdaq 100 futures rose 0.3%
  • Futures on the Dow Jones Industrial Average rose 0.3%
  • The MSCI Asia Pacific Index was little changed
  • The MSCI Emerging Markets Index fell 0.4%

Currencies

  • The Bloomberg Dollar Spot Index was little changed
  • The euro was little changed at $1.0835
  • The Japanese yen rose 0.2% to 151.25 per dollar
  • The offshore yuan was little changed at 7.2523 per dollar
  • The British pound was little changed at $1.2629

Cryptocurrencies

  • Bitcoin was little changed at $69,853.85
  • Ether fell 0.3% to $3,564.7

Bonds

  • The yield on 10-year Treasuries was little changed at 4.24%
  • Germany’s 10-year yield declined one basis point to 2.34%
  • Britain’s 10-year yield was little changed at 3.97%

Commodities

  • Brent crude fell 1.1% to $85.29 a barrel
  • Spot gold rose 0.1% to $2,181.46 an ounce

This story was produced with the assistance of Bloomberg Automation.

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