Markets Overview
- ASX SPI 200 futures little changed at 7,684.00
- Dow Average up 0.1% to 38,771.10
- Aussie little changed at 0.6556 per US$
- US 10-year yield rose 2.6bps to 4.3321%
- Australia 3-year bond yield fell 0.4 bps to 3.74%
- Australia 10-year bond yield fell 2.2 bps to 4.11%
- Gold spot up 0.2% to $2,160.10
- Brent futures up 1.9% to $86.96/bbl
Economic Events
- 14:30: (AU) March RBA Cash Rate Target, est. 4.35%, prior 4.35%
Tech giants led gains in stocks at the start of a week that will bring a raft of central-bank decisions from the US to England and Japan.
Equities rebounded from a recent pullback, with megacaps outpacing the broader market. Alphabet Inc. jumped as Bloomberg News reported Apple Inc. is in talks to build Google’s Gemini artificial-intelligence engine into the iPhone. In late hours, Nvidia Corp.’s chief Jensen Huang showed off new chips aimed at extending his company’s dominance of AI computing.
The S&P 500 halted a three-day slide, the Nasdaq 100 rose 1% and a gauge of the “Magnificent Seven” tech megacaps climbed twice as much. US two-year yields hovered near 2024 highs as expectations for Fed cuts continued to erode. The yen fluctuated after a news report the Bank of Japan is poised to end its policy of guiding government bond yields — known as yield curve control.
Ahead of the Fed decision, Japan will face a monumental moment in its history — with the nation expected to end its negative interest rate regime — the world’s last. Traders betting on the outcome of the BoJ’s decision have boosted their positions in yen futures to the highest since 2007.
Bank of America Corp. strategists said that an end to YCC would only have a limited impact on the appetite for US Treasuries.
Other News
Iron ore went on a roller-coaster ride, initially sinking well below $100 a ton only to flip higher following Chinese data that painted a mixed picture on steel demand.
Futures — which sank more than 13% last week — shed as much as 2.9% to $97 a ton in Singapore, then rebounded by more than that. While China’s overall growth was buoyed by strength in factory output and investment at the start of the year, nationwide steel production was only marginally higher in the first two months.
Iron ore is still down by more than a quarter since the start of the year, making it one of the weakest performers among major commodities. The slump has been driven principally by concerns about demand in China, where officials are battling a prolonged crisis in the nation’s steel-intensive property sector. Against that backdrop, some mills have been reducing production.
“Signs of weakness in demand continue to emerge, with Chinese smelters announcing output cuts,” ANZ Group Holdings Ltd. said in a note by analysts including Daniel Hynes.
Holdings of iron ore at ports in China — the world’s biggest importer — have been building up, pointing to ample supplies. Inventories swelled to 140.9 million tons last week, the highest level in more than a year.
Iron ore for April traded 3.9% higher at $103.80 a ton at 4:29 p.m. in Singapore, while yuan-priced futures in Dalian ended the session higher. Steel contracts in Shanghai were firmer.
(Bloomberg)
