Sensex Today Live Updates: Shares in Asia slipped to a six-week low as traders grappled with tensions in the Middle East, disappointing bank earnings and the prospect of the Federal Reserve keeping interest rates higher for longer.
A gauge for the region’s stocks fell, tracking Friday’s drop in US stocks. Benchmarks in Hong Kong, Japan and South Korea all fell while shares in mainland China rose, led by the energy sector.
But global markets showed signs of stability even after an unprecedented attack on Israel at the weekend. Iran said “the matter can be considered closed,” and President Joe Biden reportedly told Israeli Prime Minister Benjamin Netanyahu that the United States would not support an Israeli counterattack against Iran.
Futures for U.S. stocks rose in Asian trade after the S&P 500 suffered its worst session since January on Friday amid a flight to safety. Oil prices fell on speculation that the conflict would remain contained, as global benchmark Brent crude stabilized at around $90 a barrel.
Meanwhile, aluminum and nickel rose after new US and UK sanctions banned deliveries of any Russian supplies after midnight on Friday.
Chinese authorities kept a key interest rate unchanged while withdrawing money from the banking system for a second consecutive month. The operation came even after price growth stalled last month, fueling calls for more stimulus.
With investors already battered by sticky inflation and the prospect of higher for longer interest rates, the escalation of the Middle East crisis may inject fresh volatility into markets. As the conflict widens, many say oil could top $100 a barrel and expect a flight to Treasuries, gold and the dollar, along with further stock market losses.
Bitcoin rallied after it sank nearly 9% following the attacks. Stock markets in Saudi Arabia and Qatar posted modest losses under thin trading volumes on Sunday. Israel’s equity benchmark swung between gains and losses at least nine times before closing with a small gain.
As Wall Street’s earnings season kicked off, results from big banks offered the latest window into how the U.S. economy is doing amid an interest-rate trajectory clouded by persistent inflation.
JPMorgan Chase & Co. and Wells Fargo & Co. both reported net interest income — the income they generate from lending — that missed estimates amid rising financing costs. The profit of Citigroup Inc. beat analysts’ estimates as corporations tapped markets for financing and consumers leaned on credit cards — signs that a prolonged period of high interest rates will benefit big banks.
Traders will soon turn to threatened economic data as they refine bets on central bank easing cycles, as well as the spring meetings of the International Monetary Fund and World Bank in Washington. This week, Chinese growth data and inflation readings from Japan, the Eurozone and the UK are due.
Sensex Today Live: Indian markets will open cautiously as focus shifts to the tension in the Middle East
Sensex Today Live : Indian stocks open lower on Monday, trailing Asian peers, as investor sentiment was subdued after Iran’s retaliatory attack on Israel over the weekend spurred fears of a wider regional conflict.
India’s GIFT Nifty was trading at 22,470.50 at 8:04 am IST, indicating that the Nifty 50 will open below its Friday close of 22,519.40.
Asian stocks fell and gold prices rose as risk sentiment took a hit. The dollar climbed to a fresh 34-year high against the yen on growing expectations that sticky inflationary pressures in the United States will keep rates there higher for longer.
Markets in Asia started the week on a cautious footing. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.7% after Iran late on Saturday launched explosive drones and missiles at Israel in retaliation for a suspected Israeli attack on its consulate in Syria on April 1. This marked the first direct attack by Iran. on Israeli territory.
The threat of open warfare breaking out between the arch Middle Eastern enemies and a drag on the US has left the region on tenterhooks. US President Joe Biden has warned Prime Minister Benjamin Netanyahu that the US will not participate in a counter-offensive against Iran. Israel said “the campaign is not over yet”.
Japan’s Nikkei slipped more than 1%, while Australia’s S&P/ASX 200 index lost 0.6%. Hong Kong’s Hang Seng Index fell 0.8%.
The rising tensions also sparked a flight to safety, which sent gold up 0.51% to $2,356.39 an ounce and the safe-haven dollar broadly higher, extending its 1.6% gain from last week.
Oil prices, however, barely reacted to the news as traders largely priced in a retaliatory attack by Iran, which is likely to further disrupt supply chains. That saw Brent crude futures peak at $92.18 a barrel last week, the highest level since October.
Brent was last 0.5% lower at $90.01 a barrel, while U.S. West Texas Intermediate crude futures fell about 0.6% to $85.13 a barrel. (A/R)
US stock futures, meanwhile, are higher after a heavy sell-off on Wall Street on Friday as results from major US banks failed to impress. S&P 500 futures and Nasdaq futures each rose 0.15%.
Elsewhere, U.S. Treasury yields held near their recent highs as traders scaled back their expectations for the pace and scale of Federal Reserve rate hikes this year. (USA/)
The benchmark 10-year yield last stood at 4.5277%, while the two-year yield held near the 5% level and was last at 4.8966%.
A continued run of resilient US economic data, notably last week’s warmer-than-expected inflation report, added to the view that US rates could remain higher for longer, and that a Fed tapering cycle is unlikely to begin in June.
Futures now point to about 50 basis points worth of decline expected this year, a huge retreat from the 160 bps that were priced in at the start of the year.
Plenty of Fed policymakers are due to speak this week, including Chairman Jerome Powell, who could provide further clarity on the future path of US interest rates.
The change in exchange rate expectations halted bitcoin’s bullish rally, after the world’s largest cryptocurrency has repeatedly set fresh records this year thanks to flows into new spot bitcoin exchange funds and expectations of imminent Fed cuts.
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