Morning Note: A Round-up of Global Financial Market News.
Market News
US equities rose last night – S&P 500 (+1.2%); Nasdaq (+2.1%) – driven by technology as investors piled back into companies seen as beneficiaries of the AI buildout. Google has capped Meta’s Gemini use as AI demand strains capacity. Nike reports after the bell this evening.
In Asia this morning, stocks also moved higher with a regional benchmark posting its biggest quarterly jump in almost 17 years: Nikkei 225 (+1.3%); Hang Seng (-0.8%); Shanghai Composite (+0.2%). Japan signalled readiness to respond after the yen slid to 162 versus the dollar, its weakest level since 1986. Yields in Japan’s 30-year and 20-year bonds climbed.
The FTSE 100 is currently 0.4% higher at 10,502, while Sterling trades at $1.3240 and €1.1615. UK 10-year Gilt yields hovered around 4.73%, staying close to two-month lows, as bond markets absorbed Andy Burnham’s speech. Burnham, the sole candidate to succeed Keir Starmer, vowed to significantly devolve fiscal powers from Westminster to local authorities if elected, while maintaining fiscal discipline. The uncertainty led foreign investors to sell a net £5.5bn of gilts last month, snapping a buying streak from August. Domestic investors remained undeterred, purchasing a net £19.1bn.
Brent Crude steadied above $73 a barrel, holding gains from the previous session as investors turned their focus to the resumption of US-Iran peace talks in Doha, while mixed signals from both sides continued to cloud the outlook. Tehran maintained that it intends to continue overseeing traffic through the Strait of Hormuz even if Oman opts not to participate. Brent is on track for its biggest quarterly decline since the pandemic — down nearly a third this quarter.
Gold bounced off its lows to climb back above $4,000 but is still on track for a fourth consecutive monthly decline amid Middle East uncertainties and expectations that the US Federal Reserve will raise interest rates this year. The yield on the US 10-year Treasury is 4.37%.
Source: Bloomberg
