2024-04-08 10:17

A look at the day ahead in U.S. and global markets from Mike Dolan If investors were looking to the gods for Wall St's next move, the portents all look a bit ominous. A rare total solar eclipse over swathes of North America later on Monday follows one of the largest earthquakes on the East Coast of the United States in the last century on Friday. For those less superstitious, the financial backdrop was similarly anxious. Odds on a Federal Reserve rate cut in June are lengthening - with the chances of a move by then now just 50-50 following another bumper U.S. employment report on Friday. Only two quarter point cuts this year are now fully priced in futures markets, with full-year easing bets ebbing to just 63 basis points on Monday. Even though Wall St stock indexes (.SPX) , opens new tab staged a decent rally after the jobs report - which packed twin positives of above-forecast job creation and moderating wage growth - a negative first week of the new quarter left a sour taste. Stock futures were in the red again first thing on Monday as the S&P500 (.SPX) , opens new tab recoiled almost 1% for the whole of last week. And celestial events aside, there's an event packed week ahead. The March consumer price inflation report is due Wednesday, there are 10- and 30-year Treasury auctions through the week, the European Central Bank and Bank of Canada hold important policy meetings, Fed meeting minutes are released on Wednesday and the first-quarter U.S. corporate earnings season kicks off with some of the big banks on Friday. While there's a lot to unpack in all that, it's hard to get away from the overarching brake on markets from ebbing Fed easing expectations. And fearful of a correction, the VIX (.VIX) , opens new tab volatility gauge remains elevated near its highest close for the year to date. And it's another bruising period for bonds, with U.S. two- and 10-year Treasury yields hitting their highest since November at 4.79% and 4.45% respectively first thing on Monday. It's not just juggling the date of the first rate cut either. With Fed officials mulling higher estimates for their neutral interest rate assumption, given the ongoing strength of the economy, rate futures now only see about 150bp of easing for the entire cycle. Since the end of last year, the assumed "terminal rate" in March 2026 has risen almost 100bps to 3.90%. A noted Fed dove - Chicago's Austan Goolsbee - and a recognized hawk - Minneapolis Fed boss Neel Kashkari - both speak later on Monday. The dollar (.DXY) , opens new tab is pumped up again as a result - chomping at the bit against Japan's yen again just under 152 yen despite residual fears of Japanese government intervention. Payrolls aside, part of the problem last week was the jump in oil prices - as building global demand meets supply disruptions and geopolitical worries. U.S. crude prices hit their highest in almost six months last week above $87 per barrel. Their retreat on Monday to about $86 may calm the horses a bit as Middle East tensions eased after Israel withdrew more soldiers from southern Gaza and committed to fresh talks on a potential ceasefire in the six-month conflict. Overseas, stocks were generally buoyant on Monday. Japan's Nikkei (.N225) , opens new tab outperformed in Asia, while European stocks were higher too. With the ECB meeting due on Thursday, there's growing speculation the ECB will cut rates in June even if the Fed doesn't. The mood in China was more downbeat, however, as stock benchmarks there fell on Monday. Chinese property developer Shimao (0813.HK) , opens new tab tumbled 18.7% after China Construction Bank filed a liquidation petition against it in Hong Kong over its failure to repay loans of HK$1,579.5 million ($201.8 million). U.S. Treasury Secretary Janet Yellen warned China on Monday that Washington will not accept new industries being decimated by Chinese imports as she wrapped up four days of meetings to press her case for Beijing to rein in excess industrial capacity. Yellen told a media conference that U.S. President Joe Biden would not allow a repeat of the "China shock" of the early 2000s, when a flood of Chinese imports destroyed about 2 million American manufacturing jobs. Key diary items that may provide direction to U.S. markets later on Monday: * NY Fed inflation expectations survey, U.S. March employment trends * Chicago Federal Reserve President Austan Goolsbee and Minneapolis Fed President Neel Kashkari both speak; Swiss National Bank chair Thomas Jordan speaks * U.S. Treasury Secretary Janet Yellen in Beijing * US Treasury sells 3-, 6-month bills Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2024-04-08/

2024-04-08 09:38

LONDON, April 8 (Reuters) - Sterling dipped against the dollar on Monday, as weak pay figures from recruiters added to signs of a slowdown in Britain's job market. The pound was last down 0.1% versus the dollar at $1.2626 , while it was broadly flat against the euro at 85.77 pence per euro. Starting salaries for permanent staff grew at the slowest rate in over three years in March, recruiters said, while spending on temporary workers fell by the most since July 2020. The data from the Recruitment and Employment Confederation (REC) may help convince Bank of England policymakers that underlying pay pressures in the economy are easing sufficiently to keep inflation at its 2% target. However, the BoE has been reluctant to put too much weight on REC data in recent months. "This morning's REC report on jobs points to a further slowdown in the labour market in March, and is likely to fuel renewed calls for the BoE to deliver rate cuts next month," analysts at Monex Europe said in a note. "That said, we are more circumspect in our view of the data, and we suspect the (Bank of England's Monetary Policy Committee) will exercise a degree of caution too." Traders put just a 25% chance on the Bank of England cutting rates at its next meeting on May 9, according to futures markets data. Keep up with the latest medical breakthroughs and healthcare trends with the Reuters Health Rounds newsletter. Sign up here. https://www.reuters.com/markets/currencies/sterling-dips-weak-uk-pay-data-adds-signs-jobs-slowdown-2024-04-08/

2024-04-08 08:34

FRANKFURT, April 8 (Reuters) - Investor morale in the euro zone improved for the sixth consecutive month in April to its highest level in more than two years, a survey showed on Monday, adding that even though Germany remained a drag it showed "economic signs of life". Sentix's index for the euro zone rose to -5.9 points in April from -10.5 in March, its highest level since February 2022, also beating a forecast of -8.5 in a Reuters poll of analysts. "Will there finally be a sustainable economic upturn? At least the economic recovery in the eurozone and worldwide is continuing," Sentix said. "The economic signals are also stabilising internationally." Sentix said that while expectation values for Germany had improved to their highest level since February 2022, Europe's biggest economy "remains the relative problem child of the major industrialised nations". For the euro zone, the expectations index rose to 5.0 points in April from -2.3 points in March, a seventh consecutive month of rises and the highest value since February 2022. The index on the current situation in the euro zone also increased to -16.3 in April from -18.5 in the previous month, the sixth monthly increase in a row. The poll of 1,201 investors was conducted between April 4 and April 6. Get a look at the day ahead in European and global markets with the Morning Bid Europe newsletter. Sign up here. https://www.reuters.com/markets/europe/euro-zone-investor-morale-hits-two-year-high-april-2024-04-08/

2024-04-08 07:48

April 8 (Reuters) - India's fuel consumption fell 0.6% year-on-year in March, but demand for the 2024 financial year was up about 5%, primarily driven by higher automotive fuel and naphtha sales. Total consumption, a proxy for oil demand, totalled 21.09 million metric tons (4.99 million barrels per day) in March, down from 21.22 million tons (5.02 mbpd) last year, preliminary data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry showed on Saturday. However, fuel demand for the 2024 financial year, ending in March, hit a record high of 233.276 million tons (4.67 mbpd) compared to 223.021 million tons (4.48 mbpd) a year earlier. Sales of diesel, mainly used by trucks and commercially run passenger vehicles, rose 3.1% year-on-year to 8.04 million tons in March and was up 4.4% for the previous fiscal year. Sales of gasoline in March rose 6.9% year-on-year to 3.32 million tons and were up 6.4% for the fiscal year. Sales of bitumen, used for making roads, were largely steady in March, but were up 9.9% for the fiscal year. Sales of cooking gas, or liquefied petroleum gas, rose 8.6% to 2.61 million tons, while naphtha sales jumped 5.5% to about 1.19 million tons, compared with last March, the data showed. The usage of fuel oil fell 9.7% year-on-year in March and declined 6.3% for the fiscal year. DOMESTIC SALES (in million tons) Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/indias-fuel-demand-hits-new-fy-record-up-about-5-2024-04-08/

2024-04-08 07:30

MOSCOW, April 8 (Reuters) - Production in Russia is being restrained by the shortage of workers, not by a lack of finances, Elvira Nabiullina, the head of Russia's central bank, said on Monday. The economy is continuing to demonstrate impressive growth rates, Nabiullina said, addressing lawmakers in the State Duma, Russia's lower house of parliament. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/world/europe/worker-shortage-is-restraining-production-says-russias-central-bank-2024-04-08/

2024-04-08 07:27

FTSE 100 up 0.4%, FTSE 250 adds 0.7% U.S. CPI, UK GDP figures due later this week UBS raises price target on Easyjet, shares up April 8 (Reuters) - The main UK share indexes rose on Monday, supported by miners as Shanghai copper prices touched record highs, while betting group Entain rallied on speculation of a potential takeover. The commodity-heavy FTSE 100 (.FTSE) , opens new tab closed 0.4% higher following a sluggish start to the session, while the midcap FTSE 250 index (.FTMC) , opens new tab added 0.7%. Shares of mining giants Rio Tinto (RIO.L) , opens new tab, Glencore (GLEN.L) , opens new tab and Anglo American (AAL.L) , opens new tab rose in the range of 1.9% and 4.2% as copper prices climbed to new peaks, catching up with a rally in other commodities on strong manufacturing data from top metals consumer China. "Mining stocks have generally lagged but they may be starting to move now which is definitely a trend that's worth watching," said Russ Mould, investment director at AJ Bell. Investors looked ahead to U.S. inflation and UK GDP figures later this week for clues on the path of monetary policy. UK equities logged weekly losses on Friday after stronger-than-expected U.S. economic data prompted investors to scale back bets of several interest rate hikes from the Federal Reserve this year. Britain's GDP data on Friday is expected to show the economy grew 0.1% in February, on a month-on-month basis, following a 0.2% rise in January. "Wetter weather and lower oil/energy production will, we think, keep GDP from budging very much," said Sanjay Raja, senior economist at Deutsche Bank. "Looking ahead, we think the UK economy is at a turning point following on from its short and shallow recession last year." A Deloitte survey showed concern about economic uncertainty among large British companies has fallen to its lowest since mid-2021, but the improved mood is not yet translating into stronger investment. Among other stocks, Entain (ENT.L) , opens new tab rose 5.2% after a Sunday Times report said private equity firms including Apollo were circling the betting and gaming group. Easyjet (EZJ.L) , opens new tab gained 3.3% after UBS raised its price target on the airline's stock. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/world/uk/london-stocks-start-week-with-caution-key-economic-data-looms-2024-04-08/