Highlights:
- Dollar and U.S. bond yields remain near multi-month highs.
- Global shares dip as investors eye Nvidia’s earnings.
- Bank of Japan (BOJ) keeps rate hike timing unclear.
London, Nov 18, 2024 – The U.S. dollar and Treasury bond yields stayed firm near multi-month highs on Monday, fueled by expectations that the Federal Reserve would slow down interest rate cuts. Meanwhile, global equities softened, with investors anticipating Nvidia’s earnings report later this week.
Dollar and Bond Yields Remain Strong
The 10-year U.S. Treasury yield edged up 4.5 basis points to 4.471%, while the two-year yield stood at 4.3141%. Futures indicate a 60% probability of a quarter-point rate cut in December, significantly lower than earlier estimates. This shift follows Fed Chair Jerome Powell’s remarks last week, emphasizing a cautious approach to rate reductions.
The dollar index held at 106.76, slightly below last week’s one-year peak of 107.07. Major currencies like the euro and British pound remained subdued, with sterling hovering near a six-month low at $1.2621.
Global Stocks on Edge
Global equity markets showed slight declines, with the MSCI World Index down 0.1%. European shares, including STOXX 600 and major indexes in Frankfurt, London, and Paris, recorded marginal losses. In the U.S., Nasdaq futures gained 0.3%, recovering after a five-day losing streak, while S&P 500 futures rose 0.1%.
Investors are closely watching Nvidia’s earnings on Wednesday. The chipmaker is expected to report a significant revenue surge, driven by its leadership in AI technology. However, any earnings miss could dampen the market’s optimism around AI growth prospects.
Asia-Pacific and BOJ Developments
In Asia, the MSCI Asia-Pacific Index gained 0.2%, while Japan’s Nikkei 225 fell 1.1%, weighed down by a drop in tech shares. Bank of Japan Governor Kazuo Ueda reiterated the possibility of rate hikes but avoided specifics on timing. The yen remained weak at 155.18 per dollar, keeping markets on alert for possible intervention by Japanese authorities.
Commodities See Mixed Movements
Oil prices rose modestly, with Brent crude climbing 0.7% to $71.52 per barrel and U.S. crude increasing 0.5% to $67.36. Gold prices rebounded 1.3% to $2,593 per ounce, recovering from sharp declines last week.
Investors now await further clarity on global monetary policies and corporate earnings, which will shape market trends in the coming days.
