07/07/2023
Today’s Announcements & News
Asia
The Asia-Pacific markets continued their downward trend as they reacted to the sell-off on Wall Street triggered by stronger-than-expected U.S. jobs data. The ADP report revealed a significant surge in private sector jobs, surpassing market expectations and indicating robust job growth. This data, coupled with the minutes from the Federal Reserve’s June meeting, which hinted at potential rate increases, has raised concerns about tighter monetary policy.
In Australia, the S&P/ASX 200 index dropped 1.8%, leading the region’s losses. Japan’s Nikkei 225 index fell 1.13%, while the Topix index shed 1.1%. South Korea’s Kospi index slid 1.14% following Samsung Electronics’ estimation of a substantial decline in its second-quarter operating profit.
Futures tied to Hong Kong’s Hang Seng index also indicated a lower opening.
Meanwhile, U.S. Treasury Secretary Janet Yellen’s visit to Beijing for a four-day trip to meet with Chinese officials signifies a thawing of relations between the U.S. and China, which is being closely watched by market participants for any potential impact on trade and geopolitical dynamics.
US
During Thursday evening, stock futures showed little change as investors shifted their focus to the upcoming June payrolls report and its implications for the Federal Reserve’s monetary policy. Dow Jones Industrial Average futures and S&P 500 futures remained flat, while Nasdaq 100 futures slipped slightly by 0.03%.
In after-hours trading, shares of Levi Strauss tumbled 6% after the company lowered its profit outlook for the year.
Earlier in the day, the major stock market indices experienced declines following the release of the ADP jobs data, which showed that private sector employers added 497,000 jobs in June, surpassing economists’ estimates. The strong job growth raised concerns about the Federal Reserve’s potential tightening of monetary policy. Bond yields also surged, with the 2-year Treasury yield reaching its highest level since 2007, reflecting market expectations of future interest rate hikes. As a result, stocks faced selling pressure, with the Dow dropping more than 1%, and the S&P 500 and Nasdaq Composite both declining around 0.8%.
Commodity
On Thursday, oil prices remained relatively unchanged as market participants assessed the impact of tighter U.S. crude supplies against the increased likelihood of a U.S. interest rate hike that could potentially reduce energy demand.
Brent crude futures settled slightly lower by 13 cents at $76.52 per barrel, following a 0.5% increase in the previous session.
Meanwhile, U.S. West Texas Intermediate (WTI) crude saw a minimal gain of 1 cent to reach $71.80 per barrel. WTI had surged 2.9% in post-holiday trading on Wednesday to catch up with the earlier gains seen in Brent crude.
On Thursday, gold prices declined to a near one-week low following a stronger-than-expected U.S. private payrolls report, which raised expectations for additional interest rate hikes by the Federal Reserve. The rise in Treasury yields contributed to the downward pressure on gold.
Spot gold decreased by 0.38% to $1,910.0092 per ounce, while U.S. gold futures settled 0.6% lower at $1,915.40.
The better-than-expected U.S. private payrolls data for June indicated resilience in the labor market, despite concerns of a potential recession stemming from higher interest rates.
In response to the employment data, the yield on the two-year U.S. Treasury note reached its highest level since June 2007, while the dollar trimmed its losses.
The above analysis is only for the views of market researchers and is for reference only and is not regarded as a specific investment suggestion.
