Morning Note: An Update on the Latest Market News
Market News
President Trump announced an agreement with Japan that will result in reduced tariffs of 15% from 25% previously. The auto sector will also receive a lowered 15% tariff. Japan will invest $550bn in the US with Trump directing the investment. Japan’s stock market rose – Nikkei 225 (+3.5%) – while the yield on 10-year Japanese Government Bonds (JGBs) jumped 10 basis point to 1.6%, the highest level since October 2008. Traders are pricing in at least an 80% chance the Bank of Japan will hike rates by year-end.
Other Asian equity markets were also firm, while US and European stock futures rose. The auto and luxury goods sectors are firm. The FTSE 100 is currently 0.3% higher at 9,055, while Sterling trades at $1.3535 and €1.1525.
The US nuclear weapons agency was among victims of a cyberattack that Microsoft attributed to Chinese state-sponsored hackers, a person familiar said. No sensitive or classified information is known to have been compromised.
Fed Chair Jerome Powell is “only going to be there a short while,” Trump said at an event with GOP lawmakers. The 10-year Treasury currently yields 4.38%.
Nokia cut its profit guidance, citing a weaker dollar and tariffs, while Texas Instruments fell post-market as its outlook disappointed. Alphabet reports this evening after the US market close.
Gold dipped to $3,420 per ounce, pulling back slightly from a five-week high, pressured by a wave of trade deals that dampened the metal’s safe-haven appeal. The platinum market tightened to unprecedented levels in the past few days as speculative buying pull metal from the key London and Zurich markets into warehouses in the US and China. The metal has risen by 60% over the last three months. Brent Crude trades at $68.50 a barrel.
Source: Bloomberg
