EQUITIES
Asia-Pacific stocks traded higher on Thursday, mostly above 1%. Hong Kong’s Hang Seng index was among the biggest gainers regionally, rising 1.77% in mid-morning trade. South Korea’s KOSPI gained 1.12%, the Singapore’s Straits Times index climbing 1.29%, and the S&P BSE Sensex in India added 1.06%.
The Shanghai composite in mainland China gained 0.33%, and the S&P/ASX 200 in Australia advanced 0.74%.
Markets in Japan are closed for Olympic 2020’s holiday.
Overnight on Wall Street, the Dow Jones Industrial Average rose 0.83%, to 34,798, the S&P 500 gained 0.82%, to 4,358.69 and the Nasdaq Composite added 0.92%, to 14,631.95.
OIL
Oil trades above $70 and held a two-day gain, powered by a drop in U.S. fuel and distillate stockpiles and a broader market rally.
The Brent traded at $71.96 per barrel, and U.S. crude futures traded at $70.01 per barrel.
Overnight, the Brent closed at $72.23, while WTI ended at $70.30 per barrel.
CURRENCIES
The dollar index stood at 92.753, pulled back from a 3-1/2-month high of 93.194 touched yesterday.
A sell-off in Treasuries overnight that left the yield on the benchmark 10-year U.S. government debt at 1.288%.
Meanwhile, the price of bitcoin rebounded after recently falling below the $30,000 mark. It traded around $32,124. Rival ether traded at $1,993. Cryptocurrencies bounced after Tesla Inc CEO Elon Musk said the company would likely restart accepting bitcoin payments after due diligence on its energy use
GOLD
Gold inched lower on Thursday, as the dollar held strong, and investors looked past economic threats from rising cases of the Delta COVID-19 variant and opted for riskier assets instead.
The spot gold slipped to $1,798.00 an ounce and declined to $1,799.10 per ounce for gold futures. Previously closed at $1,803.30 and $1,803.40, respectively.
Silver was steady at $25.25 per ounce, palladium rose 0.46% to $2,667, and platinum gained 0.34% to $1,079.
ECONOMIC OUTLOOK
Asian stocks rallied on Thursday, due partly to positive corporate earnings, and as investors largely overlooked apprehension about the Delta coronavirus variant and inflation for now and looked ahead to the European Central Bank for reassurance of policy support continuation for some time.
A dovish tone is expected from the ECB's policy-setting decision, due at 1145 GMT later today, after President Christine Lagarde foreshadowed a guidance tweak during an interview last week. The ECB announced a new strategy which allows the bank to tolerate inflation above its 2% target and Lagarde said policy guidance would be revisited to demonstrate the bank's commitment to the new goal.
TECHNICAL OUTLOOK
[USDJPY]
Important Levels to Watch for Today:
- Resistance line of 110.516 and 110.752.
- Support line of 109.754 and 109.518.
Commentary/ Reason:
The yen traded at 110.134 per dollar, rose 0.14% on the day.
The dollar came under pressure as sharp rally in U.S. stock indexes reduced liquidity demand for the dollar.
The safe-harbour U.S. dollar and yen remained on the back foot on Thursday, as strong earnings swept away Delta concerns in the U.S. and weighing on haven currencies.
The USD/JPY pair is struggling to gain enough momentum to move past the resistance level. As such, the pair will likely hug the ascending trendline upwards as bearish sentiment appears to have dissipated.
