Yen reverses losses; European Stock Futures Rise: Markets Close

(Bloomberg) — The yen recovered sharply after falling to a 34-year low, prompting speculation that authorities may have intervened. European and US stock futures rose, following a positive session in Asia.

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The Japanese currency extended gains to as much as 2.1% after earlier falling above 160 per dollar for the first time since 1990. Low liquidity due to a holiday in the country was also cited as a reason for the volatile moves. Top currency official Masato Kanda said “no comment for now” when reporters asked whether or not he would intervene.

“The market is very unsettled and because there is not much liquidity, the yen becomes a sharp toy to play with,” said Rodrigo Catril, strategist at National Australia Bank. “The risk of intervention is an additional factor.”

Euro Stoxx 50 futures rose 0.4%, while contracts for the S&P 500 advanced slightly after the US benchmark posted its best weekly gain in 2024.

Chinese shares led the rally in Asia, adding to signs of a rebound in the once battered market amid a return of foreign money and an improvement in earnings. The Hang Seng Index pared gains after rallying toward a technical bull market. Real estate stocks rose after major developer CIFI Holdings Group Co. reached a solution to its liquidity problems with bondholders.

Traders will also focus on the Federal Reserve’s policy meeting on Wednesday after the central bank’s preferred inflation measure rose at a rapid pace in March, though roughly in line with estimates. With officials likely to keep interest rates steady at their highest levels in more than two decades, interest will focus on any twist in the tone of the statement after Chairman Jerome Powell’s meeting and news conference.

“With all measures of US consumer prices showing a steep acceleration over the past three to four months, the FOMC will undoubtedly pull back sharply from its previous forecasts of meaningful policy easing this year,” Societe Generale economists including Klaus Baader wrote in a note note. to customers. “That said, markets have already dramatically scaled back the price of rate cuts, so unless Chairman Powell emphasizes the possibility of rate hikes, market damage is likely to be modest.”

A gauge of U.S. Treasury yields fell 2.3% this month, marking the biggest monthly drop since February last year, after aggressive Fedspeak and strong economic data pushed back rate cuts. Swap traders now see just one Fed cut for all of 2024, well below the roughly six quarter-point cuts they expected in early 2024.

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Oil fell and gold fell in Asian trading as US Secretary of State Antony Blinken steps up efforts to secure a ceasefire in Gaza at Middle East meetings on Monday, in what could be a last chance to convince Israel to call off an attack on Gaza. Rafa.

In company news, Elon Musk made an unannounced trip to China on Sunday. The surprise visit appears to have yielded immediate results, with Tesla Inc. has overcome two major hurdles to introduce its driver assistance system to the world’s largest car market.

In addition, L’Occitane International SA’s billionaire owner Reinold Geiger is close to making an offer to take the skin care company private, according to people familiar with the matter.

Some important events this week:

• All four Chinese megabanks will publish their first-quarter earnings results on Monday

• Germany CPI, Monday

• Economic confidence in the eurozone, consumer confidence, Monday

• Retail sales in Australia, Tuesday

• China Caixin Manufacturing PMI, Non-Manufacturing PMI, Manufacturing PMI, Tuesday

• Unemployment in Japan, industrial production, retail sales, Tuesday

• Eurozone CPI, GDP, Tuesday

• Colombia tariff decision, Tuesday

• Amazon earnings, Tuesday

• Unemployment in New Zealand, Wednesday

• UK S&P Global / CIPS Manufacturing PMI, Wednesday

• US interest rate decision, Wednesday

• Indonesia CPI, Thursday

• South Korea CPI, S&P Global Manufacturing PMI, Thursday

• S&P Global Manufacturing PMI for the Eurozone, Thursday

• Apple earnings, Thursday

• Unemployment in the eurozone, Friday

• Norway tariff decision, Friday

• U.S. Unemployment, Nonfarm Payrolls, ISM Services, Friday

Some of the major moves in the markets:

Shares

• S&P 500 futures rose 0.3% as of 6:40 a.m. London time

• Nikkei 225 futures (OSE) rose 1.6%

• Australia’s S&P/ASX 200 rose 0.9%

• Hong Kong’s Hang Seng rose 1.1%

• The Shanghai Composite rose 0.8%

• Euro Stoxx 50 futures rose 0.4%

• Nasdaq 100 futures rose 0.4%

Currencies

• The Bloomberg Dollar Spot Index fell 0.3%

• The euro rose 0.3% to $1.0727

• The Japanese yen rose 1.3% to 156.31 per dollar

• The offshore yuan rose 0.2% to 7.2558 per dollar

• The Australian dollar rose 0.6% to $0.6572

• The British pound rose 0.4% to $1.2542

Cryptocurrencies

• Bitcoin fell 2.1% to $62,308.76

• Ether fell 3.5% to $3,194.54

Bonds

• The yield on ten-year government bonds fell by four basis points to 4.66%

• The Japanese ten-year yield rose by 3.5 basis points to 0.925%

• The Australian ten-year yield fell by four basis points to 4.48%

Raw materials

• West Texas Intermediate crude fell 0.7% to $83.23 a barrel

• Gold fell 0.2% to $2,332.48 an ounce

This story was produced with the help of Bloomberg Automation.

–With help from Matthew Burgess.

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