EQUITIES
Shares in Asia-Pacific were mixed on Wednesday trade. In Japan, the Nikkei 225 rose 0.34%, and in Australia, the S&P/ASX 200 advanced 0.50%. The Hong Kong Hang Seng added 0.13%, and India BSE Sensex rose for a third straight session on Wednesday, at 0.80% higher.
Elsewhere, the South Korea’s KOSPI was down -0.92%, the Singapore’s Straits Times index slipped -0.08%, and the mainland Chinese stocks also edged lower, down -0.04%.
Overnight on Wall Street, the Dow Jones Industrial Average rose 0.01% to end at 33,984.93 points, but the S&P 500 lost 0.02% to 4,186.72, and the Nasdaq Composite dropped 0.34% to 14,090.22 as investors digested the mixed corporate earnings reports.
OIL
Oil prices held it overnight gains as the OPEC+ decided to keep output cuts unchanged, though growing concern about fuel demand in India keep investors cautious.
The Brent crude futures traded at $66.42 per barrel, and U.S. crude futures traded at $62.93 per barrel.
Overnight, the Brent closed at $65.42 while WTI ended at $62.94 per barrel.
CURRENCIES
The dollar index stood at 91.00, bouncing from Monday’s low of 90.679, its lowest level since March 3. Trading is expected to be subdued until Powell speaks after the Fed meeting.
Yields on benchmark 10-year Treasuries stood at 1.6217%, close to a one-week high.
Ether rose to an all-time high above $2,700 after Bloomberg reported that the European Investment Bank plans to sell a 2-year digital bond worth 100 million euros on the ethereum blockchain network.
Rival cryptocurrency Bitcoin also edged up to $55,050.
GOLD
Gold prices fell to a 1-week low, weighed down by firmer U.S. Treasury yields in cautious trade ahead of the Fed meeting. The spot gold slipped to trade at $1,771.20 an ounce and rose to $1,771.10 per ounce for gold futures. Previously closed at $1,775.80 and $1,778.80, respectively.
Palladium eased after scaling a record high in the last session, copper continued its ascent towards a record above $10,000 a tonne.
ECONOMIC OUTLOOK
Asian shares were mixed on Wednesday after a slew of economic data released. The already high valuations stocks also discouraged investors from buying equities ahead of a closely watched U.S. Federal Reserve meeting.
Fed Chairman Jerome Powell is expected to reaffirm that easy monetary policy will remain in place for a prolonged period and dismiss any suggestions of tapering bond purchases.
U.S. President Joe Biden will also address a joint session of Congress, where he may make additional comments about infrastructure and stimulus spending.
OPEC+ panel decided to stick to policies broadly agreed at a previous April 1 meeting of OPEC+, while also ditched plans to hold a full ministerial meeting on Wednesday.
Among corporate earnings due today include Humana, Boeing, Apple, Ford, Qualcomm, and General Dynamics.
To date, number of confirmed worldwide cases for COVID-19 pandemic has surpassed 148.35 million, recording more than 3.13 million fatality globally.
TECHNICAL OUTLOOK
[USDJPY]
Important Levels to Watch for Today:
- Resistance line of 108.969 and 109.239.
- Support line of 108.095 and 107.825.
Commentary/ Reason:
The dollar stood at 108.839 yen, rose 0.14% on Wednesday, having jumped 0.59% and 0.19% for the last two days, extending its recovery from a 7-week low of 107.478 touched last week.
The rises in U.S. bond yield strengthened the dollar demand.
Meanwhile the yen was on the back foot as Japan’s economic recovery is being hampered by recent surges in COVID-19 cases and after the Bank of Japan acknowledged that inflation would fail to reach its key 2% target through early 2023.
Japan’s pace of vaccinations well behind global peers. Only 1% of Japan’s population has been vaccinated, compared with at least 40% in both the U.S. and Britain.
The yen also came under pressure after the BoJ cut its Japan 2021 core CPI forecast and after BOJ Governor Kuroda quashed any speculation that the BOJ will reduce stimulus.
