Moving markets today: What’s shaping the FTSE 100 this morning
Moving Markets Today: Japan’s Nikkei Hits 34-Year High, China keeps benchmark lending rates steady, China Holds Firm on Benchmark Rates, Earnings and Central Bank Decisions To Drive Stock Movement This Week
Asian markets saw mixed performance on Monday following Wall Street’s record-high close last Friday. Investors are focused on a week filled with central bank meetings. Japan’s Nikkei hit a new 34-year high, driven by Wall Street’s success. Despite economic concerns, China kept its benchmark lending rates stable. The ongoing earnings season is in full swing, and major central banks are holding their first meetings of 2024. Additionally, upcoming PMI data will offer insights into the global economic outlook at the beginning of the year. Here are five key takeaways for your day.
China Holds Steady on Benchmark Lending Rates
The People’s Bank of China has decided to keep its loan prime rates unchanged on Monday, despite concerns about a potential property sector downturn and subdued investor confidence. According to the announcement, both the one-year and five-year lending rates will remain at 3.45% and 4.2%, respectively. This decision aligns with expectations, with almost all respondents in a Reuters poll predicting no change. The Loan Prime Rate (LPR), used as the benchmark for bank loan pricing, remains steady. Last week, the PBoC also maintained the medium-term lending facility rate, against consensus expectations for a reduction.
Jeremy Hunt Advocates Tax Cuts in UK’s 2024 Spring Budget: The Times
The chancellor is set to emphasize substantial cuts in either national insurance or income tax in the March 6 budget to encourage work, as per The Times. However, a YouGov poll for The Times shows that 62% of voters prefer the government to prioritize increased spending on public services over tax cuts. The survey also indicates that more voters view the current levels of national insurance and income tax as fair rather than unfair, The Times reported.
Intense Gaza Strife Claims 178 Lives in 24 Hours; DeSantis Exits Presidential Race
Intense clashes erupted in the Gaza Strip on Sunday, resulting in 178 Palestinian casualties within 24 hours. A soldier was confirmed dead in the fighting, marking one of the deadliest days in the ongoing conflict.
Simultaneously, Ron DeSantis suspended his presidential campaign, endorsing Donald Trump for the 2024 Republican nomination, dealing a significant blow to Nikki Haley just days before the New Hampshire primary.
This Week’s Key Highlights and Events to Monitor
This week, major central banks like the Bank of Japan, European Central Bank, and Bank of Canada are expected to maintain current interest rates, according to economists. U.S. reports, especially fourth-quarter GDP figures, will be significant, alongside the latest purchasing managers’ index (PMI) reports across G7 nations. Noteworthy U.S. companies, including Tesla, Intel, Netflix, IBM, Lockheed Martin, and Seagate, are accelerating their earnings reporting. In the UK, Crest Nicholson provided market updates in line with consensus estimates, while JD Wetherspoon, amidst outlet closures, is anticipated to report increased like-for-like sales.
Japan’s Nikkei Reaches New Heights with a 34-Year Peak Driven by AI Rally
Asian markets, influenced by Tokyo’s positive performance and the AI-driven tech sector boost, prepared for a week of central bank meetings and economic data. Hong Kong’s Hang Seng fell 0.5%, Japan’s Topix rose 0.9%, and South Korea’s Kospi remained stable. The Nikkei 225 surged 1.2%, reaching a 34-year high, benefiting chipmakers like Nvidia and Advanced Micro Devices. Conversely, Hong Kong’s Hang Seng mainland properties index plummeted nearly 5%, setting record lows. Australian mining shares suffered from falling lithium prices. On Wall Street, the S&P 500 set a record with a 1.2% increase driven by tech stocks. In the bond market, 10-year Treasuries rose by almost 20 basis points to 4.12%, supporting the dollar index at around 103.141. Gold lost appeal at $2,029 per ounce. In the oil market, Brent crude dropped by 32 cents to $78.24 per barrel, and U.S. crude for February eased by 2 cents to $73.39 per barrel.