Global Markets Update: Dollar Holds Steady, Shares Show Slight Dip; All Eyes on Bank of Japan

Stay updated on global market movements, dollar stability, and the Bank of Japan's policy. Get insights on shipping, oil, and upcoming economic events.

Dec 18, 2023 - 08:32
Dec 18, 2023 - 08:32
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Global Markets Update: Dollar Holds Steady, Shares Show Slight Dip; All Eyes on Bank of Japan
Global Markets Update: Dollar Holds Steady, Shares Show Slight Dip; All Eyes on Bank of Japan

U.S. stock futures indicate a slight uptick, while the dollar stabilizes as investors await the Bank of Japan's policy update and crucial U.S. inflation data this week.

Recent attacks by Iranian-backed Houthi militants on Red Sea vessels led to a rise in shares of major shipping companies, especially in Europe. The potential impact on shipping rates boosted oil prices.

The global MSCI index of shares experienced a marginal 0.1% dip. S&P 500 futures rose by 0.2%, and Nasdaq futures saw a 0.1% increase.

European stocks remained mostly flat after securing their fifth consecutive weekly gain on Friday. Shipping companies, such as Maersk and D'Amico, saw positive momentum, with shares surging between 4% and 6%.

Oil prices climbed amid concerns about potential disruptions in oil supply due to Red Sea attacks. Brent reached $77.14 a barrel, and U.S. crude rose to $71.86.

As central bank policymakers' remarks increasingly influence markets, the Bank of Japan's policy decision will be a focal point this week. Analysts expect 17 out of 28 economists to favor April for initiating the end of negative rates, marking a rare tightening move.

South Korea's main index closed 0.3% higher, seemingly unaffected by reports of North Korea firing a ballistic missile off its east coast.

In the U.S., attention turns to the core personal consumption expenditure (PCE) index, predicted to rise by 0.2% in November, with the annual inflation rate slowing to 3.4%.

Market expectations of a Fed rate cut in March have risen, with futures implying a 74% chance. The dovish outlook also affected the dollar, slipping 0.2% against a basket of currencies.

Yields on 10-year notes stood at 3.90%, having experienced the largest weekly fall since early 2020.

The euro held at $1.0915, supported by market expectations of easing from the European Central Bank and the Bank of England.

Gold, trading at $2,022 an ounce, remains positively influenced by the weakened dollar and lower yields, though still below its recent peak of $2,135.40.

Also Read: Market Watch: Jobs Report Sparks Interest as Futures Experience a Minor Dip

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