Money

Asian shares subdued as yields challenge valuations

Asian shares start week muted as high Treasury yields test valuations; U.S. dollar strong amid light trading ahead of holidays.

Published

6 months ago

December 30, 2024

ticker NEWS

Asian shares start week muted as high Treasury yields test valuations; U.S. dollar strong amid light trading ahead of holidays.

Asian shares began the week with little movement as high Treasury yields put pressure on elevated Wall Street valuations.

Trading volumes were low with the New Year holiday approaching and limited economic data expected. Important releases include China’s PMI factory surveys on Tuesday and the U.S. ISM survey for December on Friday.

MSCI’s Asia-Pacific index outside Japan declined by 0.2% but remains 16% higher for the year. Japan’s Nikkei decreased by 0.9%, despite a 20% gain for 2024. In contrast, South Korea’s main index struggled, dealing with political uncertainty and registering a 9% loss for the year.

Jeju Air’s shares plummeted to a record low following a plane crash that resulted in 179 fatalities. On a more positive note, Chinese blue chips increased by 0.3%, aided by stimulus measures announced in September.

In European markets, EUROSTOXX 50 futures rose slightly, while FTSE and DAX futures remained stable. In the U.S., S&P 500 and Nasdaq futures slipped by 0.1%.

The S&P 500 and Nasdaq recorded annual increases of 25% and 31%, respectively, raising concerns over valuations considering the current yields on 10-year Treasuries, which are near eight-month highs.

The strong U.S. dollar, bolstered by rising interest rates, remains significant amid fluctuating gold and oil prices, as markets monitor ongoing economic developments.

Money

Aussie job market defies expectations with stable 4.1% unemployment rate

Australia’s unemployment held at 4.1% in May amid job loss; full-time roles surged, underemployment fell, and female participation rose to 60.9%, keeping RBA cautious despite rate cut speculation.

Published

8 hours ago

June 20, 2025

ticker NEWS

Australia’s unemployment held at 4.1% in May amid job loss; full-time roles surged, underemployment fell, and female participation rose to 60.9%, keeping RBA cautious despite rate cut speculation.

Australia’s unemployment rate held firm at 4.1% in May, despite a small drop of 2,500 jobs—falling short of forecasts.

But dig deeper: full-time jobs jumped by nearly 39,000, underemployment hit post-COVID lows, and female participation reached a record 60.9%.

With labour market resilience still strong, the Reserve Bank is unlikely to be swayed—though markets see an 80% chance of a July rate cut.

The RBA remains in a balancing act, cooling inflation, without choking growth.

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Money

Central banks struggle with economic uncertainty and rates

Central banks face challenges amid economic uncertainty, impacting policy decisions and investor confidence worldwide.

Published

10 hours ago

June 20, 2025

Ahron Young

Central banks face challenges amid economic uncertainty, impacting policy decisions and investor confidence worldwide.

In Short:
Central banks are grappling with economic uncertainty, prompting various interest rate cuts globally to stimulate growth. Many central banks, including those in Norway, Sweden, and Japan, are adjusting rates in response to inflation and trade concerns, while others like the Federal Reserve and the Bank of England are considering future cuts.

Central banks are facing significant uncertainty concerning economic growth and inflation, making their policy decisions increasingly challenging as they approach the end of their rate-cutting cycles.

This uncertainty is also impacting investors. Recently, Norway’s central bank surprised markets with an interest rate cut, while the U.S. Federal Reserve cautioned against relying heavily on its policy projections.

The Swiss National Bank responded to decreasing inflation and economic unpredictability by reducing its benchmark rate to 0% but may consider further cuts. The Bank of Canada has maintained its rate at 2.75%, suggesting a potential future cut in light of tariffs affecting the economy.

Sweden’s central bank cut its key rate as well, aiming to stimulate growth amid weak price pressures.

In New Zealand, expectations are for rates to remain steady after a recent reduction to protect its economy from global trade uncertainties. The European Central Bank has also cut rates, considering further adjustments to meet inflation goals.

The Federal Reserve is keeping rates steady, although further cuts are anticipated due to low inflation. In Britain, the Bank of England held rates but may continue cuts in response to weak labour indicators.

The Reserve Bank of Australia is prepared for rate cuts due to weak growth data and trade tensions, while Norway’s central bank has been cautious with its recent decision. The Bank of Japan remains the only bank in a tightening phase, balancing escalating tensions and tariff concerns with its monetary policies.

Money

Fed signals slower cuts amid rising risks

U.S. Federal Reserve revises economic forecasts downward, expecting growth slowdown and higher unemployment, but still plans rate cuts in 2024 and 2025.

Published

1 day ago

June 19, 2025

ticker NEWS

U.S. Federal Reserve revises economic forecasts downward, expecting growth slowdown and higher unemployment, but still plans rate cuts in 2024 and 2025.

At its latest meeting, the U.S. Federal Reserve revised its economic forecasts downward, with growth trimmed, inflation nudged up, and unemployment expectations now higher.

Despite this gloomier outlook, the Fed still sees two rate cuts in 2025, but just one in 2024 and one in 2026, a major dial-back from earlier projections.

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#FederalReserve #InterestRates #JeromePowell #Inflation #USEconomy #FedMeeting #tickernews