In Asian Equity Markets stocks sat out a global rally on Friday as disappointing earnings from Chinese e-commerce giant Alibaba reinforced worry about slowing growth in the world’s second-largest economy, even as European and U.S. share futures indicated gains. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.44 percent and was set for a weekly decline of 1 percent, even after a solid performance overnight on Wall Street boosted by upbeat corporate earnings. The Hong Kong benchmark down sharply 1.5 percent, dragged down by index heavyweight Alibaba.
In Currency Markets the dollar was set to post a second week of chunky gains against the euro on Friday as traders wager on interest rates rising faster and further on the North Atlantic’s western shore, while sterling and the kiwi also firmed with rate hike bets. The euro has been the week’s big mover, and although it has recovered to $1.1356 after falling to $1.1263, it remains vulnerable as fundamentals and positioning swing to favour the dollar. Sterling gained about 0.5 percent to $1.3487 as a rise in inflation to a 10-year high has firmed bets on the Bank of England hiking rates in a month.
In US Equity Markets the S&P 500 and Nasdaq notched record closing highs on Thursday, boosted by upbeat corporate earnings news from companies including Nvidia, while Turkey’s lira weakened further after its central bank cut rates. The Dow fell 0.17 percent, to 35,870.95, the S&P 500 gained 0.34 percent, to 4,704.54 and the Nasdaq Composite added 0.45 percent, to 15,993.71. Macy’s Inc rose 21.1 percent, its largest one-day percentage gain in decades, after it raised its annual earnings guidance and flagged plans for a potential spinoff of its ecommerce division.
In Commodities Markets gold prices fell on Thursday as encouraging weekly U.S. jobless claims data strengthened bets for an earlier-than-expected rate hike by the Federal Reserve following recent strong inflation data out of the United States. Spot gold fell 0.4 percent to $1,858.76 per ounce. Platinum fell 0.8 percent to $1,048.77 per ounce, while palladium slid 2.7 percent to $2,129.28. Silver lost 0.9 percent to $24.82. Brent crude was up slightly on Thursday but declined in early trading as much as 1.2 percent to a six-week low of $79.28 per barrel. U.S. WTI was down 1.6 percent at one point at $77.08 per barrel.
In European Equity Markets stocks ended lower on Thursday, weighed by weakness in commodity-related stocks amid declining oil and metal prices, and breaking a record-breaking six-day rally fuelled by strong earnings. The pan-European STOXX 600 index lost 0.5 percent, its first fall in seven sessions, with energy stock and miners falling about 2 percent each. Submarines-to-steel group Thyssenkrupp jumped 6.3 percent after it said profit could more than double next year and it may take its hydrogen unit public.
In Bond Markets U.S. Treasury yields fell on Thursday after the relative success of a 20-year bond auction on Wednesday reduced fears about further rapid yield increases, while the U.S. Treasury saw strong demand for an auction of 10-year inflation-linked debt. Benchmark 10-year notes were last at 1.587 percent. They have jumped from a low of 1.415 percent last week and are holding below five-month highs of 1.705 percent reached on Oct. 21. The Treasury sold $14 billion in 10-year Treasury Inflation-Protected Securities (TIPS) on Thursday to strong demand.