Jerome Powell delivered the 25 basis point rate hike widely expected by the Fed Funds futures market. The statement by the Federal Open Markets Committee (FOMC)had a dovish bias.
U.s. Government officials were also pondering increasing the limit on deposit insurance, though there was no agreement on this as yet. The unease left both S&P 500 futures and Nasdaq futures barely changed, with Chinese blue chips up 0.3%.
The DAX 40 and the FTSE 100 are both showing gains of 1.4%. The safe-haven Japanese Yen has slipped against the US dollar by 0.75%. Gold is currently trading around $1,966/oz.
US dollar rate continues to remain a sell on rise asset among investors. Dollar index sustained below 103 levels ahead of two-day FOMC meeting beginning today. Market is buzz with hawkish stance from the US Fed officials in this meeting.
Investors' confidence was negatively impacted by the turbulence in the US banking industry caused by SVB bankruptcy and the closure of New York's signature bank. Global markets are in brittle mode because everyone is eyeing the outcome of the upcoming US FOMC meeting.
Bitcoin touched its highest level in a month thanks to significant cooling in US inflation data. Bitcoin's intraday high is currently at $17,930.09 on Wednesday. Other crypto markets are on a bull run with the focus now shifting toward the FOMC policy meeting. Bitcoin dominance crossed the 41% mark which indicates de-risking by a large number of investors.
CFRA chief investment strategist Sam Stovall says markets will recover in the second half of 2023. He expects the Federal Reserve to conclude tightening and pause further rate hikes by the third quarter of year. The consensus economist forecast currently calls for a 50-basis-point rate hike at the next FOMC meeting on Wednesday.
The market is likely to consolidate around the current levels till then. The PSU banking space, particularly the leading names, will continue to remain resilient. Next week will be significant for global equity markets since we will have the US inflation print and the FOMC meet. The global spillovers are slowing down India’s economic momentum.
US Nonfarm Payrolls is one of the key data points for the Fed going into their next FOMC meeting on 14 December. We expect US job growth to decline from 261k to a still decent 220k (consensus 200k) We pencil in a rise in the seasonally adjusted unemployment rate to 1.7% - which is naturally still very low.
The Dow Jones Industrial Average has rallied by around 20% to close at 34,347 points as of Friday. This is in an environment where the US Federal Reserve has been raising the federal funds rate, its key short interest rate, to rein in decadal high retail inflation in the US. The last four times the FOMC has met, it has raised the rate by 75 basis points each time.
Gold futures are broadly flat on Wednesday tracking the international spot prices. At MCX, Gold price is currently near ₹52,200, while silver is trading near � 60, 950. 24 carat gold in 10 grams is cheaper by � 110 on Wednesday to � 52,640. Investors held back from making big bets ahead of FOMC meeting minutes.
Markets are likely to take cues from global triggers this week which is also a week of monthly expiry. On Friday, US markets closed in the positive. Minutes of FOMC will be released this week and many Fed members have indicated a hard monetray policy stance. Asian frontline indices Nikkei 225 and Shanghai Composite were also trading with negative bias.
The US Federal Reserve’s Open Market Committee (FOMC) has gone in for a fourth consecutive 75 bps rate hike. This is about 100 bps away from the terminal rate... The issue is how high will rates go and for how long India's domestic macros relatively better. Watch for bottom-up domestic focused opportunities.
Crude oil prices are just 13% up ytd from 60% level of March when the war started. The supply distress was visible this week as prospects of Iranian oil making its way to global market are getting bleaker. OPEC+ itself underproduced the quota limit by 3.58mbpd or 3.5% of global output in August.
The US dollar hit levels last seen two decades ago in early european trade as the greenback rallied. He warned that he was not 'bluffing' about the use of nuclear weapons in response to what he sees as western aggression. The escalation has taken the limelight off tonight’s FOMC monetary policy decision, but not for long.
Euro zone blue-chip stocks index (.STOXX50E) dropped 0.9% by 0804 GMT, ahead of the Federal Open Market Committee's (FOMC) interest rate decision on Wednesday. Eurozone markets closed their worst weekly performance in three months on Friday on escalating recession worries.
Jerome Powell speaks during a news conference following a two-day meeting of the Federal Open Market Committee (FOMC) in washington, u.s., on july 27, 2022. The benchmark S&P 500 (.SPX) remains nearly 8% away from its august peak and is down 17% year-to-date.
A hawkish message from FOMC Chair Powell at Jackson Hole will likely keep upward pressure on the US dollar in the run?. The monetary policy conference is due to start on friday.
FTSE 100 in London slipped 0.2% to 7,498.98 while Frankfurt's DAX added 0.3% to 13,672.70. London, Shanghai, Tokyo, and Hong Kong declined on Thursday. Wall Street futures for the benchmark S and P 500 index and the Dow Jones Industrial Average were off 0.3%.
Dow Jones and Nasdaq 100 posed a bounce after the release of FOMC minutes from the July rate decision. The indices still finished in the red after opening the session with weakness. A major driver continues to be recessionary fears, and the meeting minutes highlighted a Federal Reserve that doesn’t look to be near a policy pivot.
The stock market gained nearly 2 percent and continued the winning streak for the fourth consecutive week. For the week, the BSE Sensex gained 1,074.85 points (1.84 percent) to end at 59,462.78, while the Nifty50 added 300.7 points to close at 17,698.2 levels.
Comments from Fed Governor Chris Waller are coming up at 10:50 am ET. He's a noted hawk and his most-recent comments were on July 29 when he said a soft landing is a plausible outcome for the US labor market. The terminal top is 3.62% in March 2023.
