In Asian Equity Markets indices traded lower on Thursday morning after Chinese inflation data came in below expectations. The Shanghai composite, Shenzhen composite and Shenzhen component all marginally fell  0.1 percent.  Japan’s Nikkei 225 slipped 1.49 percent while the Topix index declined 1.19 percent. South Korea’s Kospi was lower by 0.32 percent as shares of steelmaker Posco fell more than 1 percent. In Australia, the benchmark ASX 200 fell 0.19 percent, with the sectors mixed.

 

In Currency Markets the U.S. dollar was under pressure early on Thursday on growing expectations the Federal Reserve will pause its rate tightening cycle this year, while optimism about the Sino-U.S. trade talks reduced demand for safe-haven assets. Minutes from the Fed’s Dec.18-19 meeting revealed that several policymakers were in favour of the US central bank keeping rates steady this year. The dollar index was marginally lower at 95.14, after losing 0.7 percent on Wednesday. Elsewhere, the Australian dollar, often considered a barometer of global risk, was steady at $0.7170.

 

In Commodities Markets oil prices fell by 1 percent on Thursday on swelling U.S. supply, although the mood in global markets was increasingly confident amid hopes the United States and China may soon end trade disputes that have undermined global economic growth. U.S. West Texas Intermediate (WTI) crude oil futures were at $51.75 per barrel, down 61 cents, or 1.2 percent, from their last settlement. International Brent crude futures were down 1 percent, or 63 cents, at $60.81 per barrel.

 

In US Equity Markets indices rallied for a fourth session on Wednesday, propelled by Apple, chip-makers and other trade-sensitive stocks after signs of progress in trade talks between the United States and China.  The S&P 500 gained 0.41 percent to 2,584.96. The Nasdaq Composite added 0.87 percent to 6,957.08. The S&P technology index rose 1.50 percent, with Apple Inc up 1.70 percent despite a Nikkei report that the company had reduced planned production for its three new iPhone models for the January-March quarter.

 

In Bond Markets dovish Federal Reserve speakers and a strong 10-year note auction helped bring Treasury yields down from two-week highs on Wednesday, after optimism that the United States would reach a trade deal with China had earlier boosted risk appetite. Benchmark 10-year notes gained 1/32 in price on the day to yield 2.714 percent, after earlier rising to 2.747 percent, the highest since Dec. 28. Strong demand for a $24 billion in 10-year notes on Wednesday also sent yields lower. The government will also sell $16 billion in 30-year bonds on Thursday.

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