Eurostoxx 50 futures were off 0.1%, those for Germany’s Dax were barely changed while London’s FTSE futures were up 0.4%. E-Mini futures for the S&P 500 were mostly flat.

Earlier, MSCI’s broadest index of Asia-Pacific shares outside of Japan had started on a firm footing, going as high as 697.01 points, a level last seen on March 18.

However, it succumbed to selling pressure and was last down 0.1% after Chinese and Hong Kong shares opened in the red following a strong rally last week.

China’s bluechip CSI300 index was down about 1% while Hong Kong’s Hang Seng index fell 0.8%.

Geopolitical tensions in the region added to the jitters.

Taiwan’s foreign minister said on Wednesday it will fight to the end if China attacks, adding that the United States saw a danger that this could happen amid mounting Chinese military pressure, including aircraft carrier drills, near the island.

Other Asian markets were still positive.

Japan’s Nikkei was a shade higher while Australian shares rose 0.6% and South Korea’s KOSPI added 0.3%. New Zealand ended 0.7% higher.

Broadly, successful vaccine rollouts in the United States and UK together with sturdy macro-economic data have boosted investors’ risk appetite, aiding shares and emerging market assets.

“The U.S. economy is experiencing the first effects of a powerful double-dose vaccine of broad inoculation and fiscal stimulus,” said David Kelly, chief global market strategist at J.P. Morgan Asset Management.

“The reality is that forecasts remain very uncertain…(but) early signs show the recovery is accelerating, suggesting a faster return to ‘normal’ than many had dared to hope a few months ago,” Kelly added.

Overnight, the three major Wall Street indexes closed lower, a day after the S&P 500 and the Dow rose to record levels driven by a stronger-than-expected jobs report last Friday and data showing a dramatic rebound in the U.S. services industry on Monday. (N)

Investors also weighed the latest U.S. job openings report, which showed that vacancies rose to a two-year high in February while hiring had its biggest gain in nine months amid increased COVID-19 vaccinations and additional government stimulus.

Moreover, the International Monetary Fund raised its global growth forecast to 6% this year from 5.5%, reflecting a rapidly brightening outlook for the U.S. economy.

The upcoming earnings season is expected to show S&P profit growth of 24.2% from a year earlier, according to Refinitiv data, and investors will be watching to see whether corporate results further confirm recent positive economic data.

Elsewhere, all eyes will be on minutes of the U.S. Federal Reserve’s policy meeting with a rally in U.S. Treasuries extending into Wednesday. Ten-year yields (US10YT=RR) were down at 1.6455% from as high as 1.776% on March 30.

The five-year U.S. Treasury yields dropped sharply to 0.874%, weighing on the U.S. dollar. [FRX/]

The five-year Treasury yield is seen as a major barometer of how much faith investors have in the Federal Reserve’s pledge that it does not expect to raise interest rates until 2024.

The dollar rebounded from a two-week low of 92.246 against a basket of world currencies.

The euro was flat at $1.1874, sterling was slightly weaker at $1.3788, while the Japanese yen was a touch lower at 109.77.

In commodities, Brent crude futures was flat at $63.74 a barrel while U.S. crude was up 2 cents at $59.35.

Spot gold was off a touch at $1,741.4 an ounce.

Source: Investing.com

But optimism about talks between the United States and Iran over Iran’s nuclear programme and an impending increase in supply by major oil producers capped gains.

Brent crude futures for June rose by 16 cents, or 0.3%, to $62.90 a barrel by 0657 GMT while U.S. West Texas Intermediate crude for May was up 14 cents, or 0.2%, to $59.47.

“Optimism on the global economic outlook boosted sentiment in the crude oil market,” analysts from ANZ bank wrote in a note on Wednesday.

Prices were buoyed as data on Tuesday showed U.S. job openings rose to a two-year high in February while hiring picked up. This followed earlier data showing improvement in the services sectors in the U.S. and China.

The International Monetary Fund said on Tuesday unprecedented public spending to fight COVID-19 would push global growth to 6% this year, a rate unseen since the 1970s.

Optimism on a wider rollout of vaccines also boosted prices with U.S. President Joe Biden moving up the COVID-19 vaccine eligibility target for all American adults to April 19.

U.S. crude oil stockpiles fell more than expected in the week ended April 2, while fuel inventories rose, according to three market sources, citing American Petroleum Institute (API) figures ahead of government data on Wednesday.

Oil production in the U.S. is expected to fall by 270,000 barrels per day (bpd) in 2021 to 11.04 million bpd, the Energy Information Administration (EIA) said on Tuesday, a steeper decline than its previous monthly forecast for a drop of 160,000 bpd.

Iran and world powers held what they described as “constructive” talks on Tuesday and agreed to form working groups to discuss potentially reviving the 2015 nuclear deal that could lead to Washington lifting sanctions on Iran’s energy sector and increasing oil supply.

Oil prices dropped earlier this week after the Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, agreed to gradually ease oil output cuts from May.

“Crude prices seem poised to consolidate as energy traders need to see how exactly OPEC+ follows through with their plan to boost output, and if the EU will near virus immunity by the end of June,” said Edward Moya, senior market analyst at OANDA.

Source: Investing.com

At 2:55 AM ET (0755 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was up 0.1% at 92.390, just above a two-week low of 92.246, slipping further from a five-month high of 93.439 set at the end of last month.

USD/JPY rose 0.1% at 109.78, GBP/USD was down 0.2% at 1.3793, while the risk-sensitive AUD/USD was down 0.2% at 0.7649.

The previous quarter saw the dollar’s strongest rally in years on rising expectations that accelerating U.S. economic growth and inflation could force the Fed to abandon its pledge to keep interest rates near zero until 2024.

However, these expectations have been reined in at the start of the new quarter, with EUR/USD rallying to a two-week high of 1.1878, and the benchmark 10-year U.S. Treasury yield dropping sharply to 1.65%.

Yet many investors still question whether the Fed can stick to its dovish stance, particularly given the recent employment data. Friday’s payrolls report was much stronger than expected while Tuesday’s data showed the job market is creating more opportunities at a faster clip than many economists and employers forecast.

“The labor market is probably running hotter than you think and global key figures are now in tightening territory,” said analysts at Nordea, in a note. “Perhaps the Fed’s dual mandate will be fulfilled already by early 2022?”

The market will get a little more insight into what Fed policy makers were thinking about inflation and the current state of the bond-buying program when the minutes of last month’s Open Market Committee meeting are released. later Wednesday.

U.S. President Joe Biden on Tuesday moved up the Covid-19 vaccine eligibility target for all American adults to April 19, two weeks earlier than the May 1 deadline he announced previously.

Elsewhere, USD/INR soared 0.8% to 74.065, with the Indian rupee falling to the lowest level since November low after the country’s central bank kept its benchmark repurchase rate at a record low of 4% but cut its cash reverse ratio and also signaled readiness to act to support growth. The RBI said it will keep its accommodative stance for as long as necessary.

In Europe, Poland’s central bank is expected to keep its benchmark interest rate at 0.1% for an 11th straight month later Wednesday, with worries about the economic damage from tighter Covid-19 restrictions set to outweigh rising inflation and a weaker national currency.

USD/PLN rose 0.1% to 3.8716, while EUR/PLN climbed 0.1% to 4.5959. The zloty hit a 10-year low against the euro last week under pressure from record Covid-19 infections – only three months after the central bank had intervened to stop it strengthening against the euro.

Source: Investing.com

Japan’s Nikkei 225 gained 0.70% by 11:20 PM ET (3:20 AM GMT) and South Korea’s KOSPI was up 0.41%.

In Australia, the ASX 200 jumped 1.23%.

Hong Kong’s Hang Seng Index was up 0.39%. The city opened its COVID-19 inoculation program to a further 5.5 million people, including those 30 and above, with registration opening earlier in the day.

China’s Shanghai Composite edged up 0.15% and the Shenzhen Component edged up 0.14%.

The S&P 500 Index climbed for a fifth consecutive session, with utilities and real estate leading the week. Apple Inc (NASDAQ:AAPL)., Tesla (NASDAQ:TSLA) Inc., and Facebook Inc (NASDAQ:FB). also pushed the Nasdaq 100 Index higher, while contracts on the U.S. benchmarks remained little changed.

Australian ten-year bond yields dropped after benchmark ten-year U.S. Treasury rates also fell from the previous week’s highs.

Investors are now turning their attention to the Fed meeting and await its policy decision, due on Wednesday, where Fed Chairman Jerome Powell is widely expected to reaffirm his no-tightening policy stance. The Fed is also expected to give updated economic and interest rate projections alongside its policy decision.

One beneficiary, should the Fed maintain a hands-off approach to the recent spike in yields, is the reflation trade. With increased bets on faster global economic recovery from COVID-19 already pushing one market gauge of inflation to its highest level since 2008, a renewed climb in yields could drive a rotation from growth to value stocks.

“The stimulus package is a boon for the consumer, investors are expecting the consumer to come out and spend some of that pent-up demand,” Aviva (LON:AV) head of U.S. equities Susan Schmidt told Bloomberg.

Small-cap and even tech stocks will both benefit from the recovery. “Right now, in the market, we’re overshooting away from tech and sometimes we can go too far,” Schmidt added.

Other central banks due to hand down their policy decision later in the week are the Bank of England (BOE), whose decision comes Thursday, and the Bank of Japan’s decision comes a day later. BOE is widely expected to keep its current monetary policy unchanged as well.

Also on investors’ minds are a potential U.S. infrastructure spending package and the impact of potentially higher taxes on corporate profits.

On the COVID-19 front, fears of potential side effects have caused more European countries to suspend the rollout of the AstraZeneca PLC (LON:AZN)/University of Oxford COVID-19 vaccine. The suspensions are further delaying the continent’s inoculation drive.

Source: Investing.com

Brent crude was down 69 cents, or 1%, at $68.19 by 0531 GMT, having dropped 0.5% on Monday. U.S. crude was down 69 cents, or 1.1%, at $64.70 a barrel, after declining 0.3% in the previous session.

Germany, France and Italy plan to suspend AstraZeneca (NASDAQ:AZN) PLC COVID-19 injections after reports of possible serious side effects, although the World Health Organization said there was no established link to the vaccine.

These moves are deepening concerns about a slow pace of vaccinations in the region, which may delay any economic recovery from the pandemic in one of the hardest-hit areas.

The pandemic eviscerated demand for oil but prices have recovered to levels before the global health crisis, only to be capped as vaccination rollouts have been slow in most countries.

In the United States, stockpiles are also rising because of last month’s “big freeze” which halted refining operations that have taken time to fully return.

“Prices are pressured by expectations that last month’s winter storm in Texas could keep boosting crude inventories,” said Avtar Sandu, senior manager commodities at Phillip Futures in Singapore.

The American Petroleum Institute, an industry group, will report crude stock pile levels later on Tuesday, followed by official numbers from the Department of Energy on Wednesday, with analysts expecting another week of gain. [API/S]

Crude inventories increased by 12.8 million barrels in the week to March 5, against analysts’ expectations for a rise of less than 1 million barrels.

Source: Investing.com

At 3:55 AM ET (0755 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was up 0.1% at 91.927.

USD/JPY was up 0.1% at 109.22, after rising to a nine-month high of 109.36 on Monday and ahead of the Bank of Japan’s two-day policy meeting starting Thursday.

EUR/USD fell 0.1% to 1.1919, while GBP/USD fell 0.5% to 1.3831, ahead of a Bank of England meeting on Thursday on a combination of rising inflation expectations and confidence that the Bank of England will keep its policy unchanged at its meeting on Thursday. The risk-sensitive AUD/USD dropped 0.3% to 0.7736.

The main focus will be on the Federal Reserve this week, as it begins its two-day policy meeting later Tuesday.

While the U.S. central bank is not expected to make any changes to its current monetary policy, what Chairman Jerome Powell has to say about the run-up in bond yields will be keenly studied amid concerns that economic growth and rising inflation could prompt a faster-than-expected normalisation of monetary policy.

“A largely unchanged FOMC statement and a Jay Powell press conference repeating that the Fed has a long way to go before reducing stimulus should prevent the dollar running too far ahead,” said analysts at ING, in a research note.

The market is also waiting for a decision on the supplemental leverage ratio exemption, a move that allows big banks to exclude reserve deposits and Treasury holdings from their capital ratio calculations. This is due to expire at the end of this month.

“Failing to extend it would be a big surprise, hit Treasuries and also hit equities on the view that U.S. banks would have to raise more equity capital,” ING added.

Away from the Fed, Norway’s central bank is likely to keep its key policy rate unchanged when it meets on Thursday, but the upturn in inflationary pressures will make for increasingly difficult decisions for Turkey’s central bank, also on Thursday, and Russia’s on Friday.

Source: Investing.com

The move upwards pushed Litecoin’s market cap up to $12.703B, or 0.84% of the total cryptocurrency market cap. At its highest, Litecoin’s market cap was $15.750B.

Litecoin had traded in a range of $176.955 to $191.137 in the previous twenty-four hours.

Over the past seven days, Litecoin has seen a rise in value, as it gained 3.86%. The volume of Litecoin traded in the twenty-four hours to time of writing was $5.570B or 4.58% of the total volume of all cryptocurrencies. It has traded in a range of $153.9510 to $205.0519 in the past 7 days.

At its current price, Litecoin is still down 54.49% from its all-time high of $420.00 set on December 12, 2017.

Elsewhere in cryptocurrency trading
Bitcoin was last at $49,293.7 on the Investing.com Index, up 1.22% on the day.

Ethereum was trading at $1,546.27 on the Investing.com Index, a loss of 0.75%.

Bitcoin’s market cap was last at $919.080B or 60.73% of the total cryptocurrency market cap, while Ethereum’s market cap totaled $177.753B or 11.74% of the total cryptocurrency market value.

Source: Investing.com

Canada’s economy grew at an annualized rate of 9.6% in the fourth quarter, beating analyst expectations of 7.5%, Statistics Canada data showed on Tuesday, with GDP expected to climb 0.5% in January.

The price of oil, one of Canada’s major exports, rose before this week’s OPEC+ meeting where producers are expected to ease supply curbs as economies start to slowly recover from the coronavirus crisis.

U.S. crude prices rose 0.9% to $61.18 a barrel, while the Canadian dollar was trading 0.1% higher at 1.2638 to the greenback, or 79.13 U.S. cents.

On Monday, the loonie strengthened 0.7%, its biggest gain in nearly six weeks, as pressure on stocks due to the recent jump in bond yields faded.

Global stock markets paused on Tuesday as investors sought to guess the bond market’s next move.

Canadian government bond yields were higher across a steeper curve, with the 10-year up 3.5 basis points at 1.377%. On Friday, it touched its highest intraday since January last year at 1.501%.

Source: Investing.com

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.03% to 90.817 by 11:05 PM ET (4:05 AM GMT).

The USD/JPY pair edged up 0.16% to 106.84, after coming close to hitting the 107 mark, a level unseen since August 2020, during the previous session.

The AUD/USD pair inched up 0.10% to 0.7825 and the NZD/USD pair inched up 0.03% to 0.7288.

The USD/CNY pair inched down 0.09% to 6.4647. China’s Caixin services purchasing managers’ index (PMI) for February, released earlier in the day, was 51.5 against January’s 52 figure.

The GBP/USD pair inched up 0.09% to 1.3965.

Commodity-linked currencies, such as the Australian dollar, held on to sizeable two-day advances as yields fell. Positive Australian economic data stated that GDP grew 3.1% quarter-on-quarter in the fourth quarter of 2021 and shrank 1.1% year-on-year, both above forecasts, also provided additional support for the AUD.

Bonds have caused volatility in the market as of late, after Treasuries led a dramatic jump in yields globally during the previous week. The volatility came even as central bankers, led by the U.S. Federal Reserve, called for patience in normalizing monetary policy as global economies continue their recovery from COVID-19.

Continued progress on the $1.9 trillion stimulus package proposed by U.S. President Joe Biden led to hopes for a quick economic recovery from COVID-19.

“Risk sentiment dynamics are the key driver of currencies in general right now … equity market reaction will be one of the key determinants of the impact of this move in global rates on forex markets,” Barclays (LON:BARC) Capital senior currency strategist Shinichiro Kadota told Reuters.

The calm in markets could prove short-lived should an improving U.S. economy lead to a second bond selloff. The U.S. employment report, including non-farm payrolls, will be released on Friday.

Fed Governor Lael Brainard stuck to the Fed’s dovish tone earlier in the week, saying there is still a lot of ground to cover on jobs and inflation. However, she added she is “paying close attention” to bond market developments, where “the speed of the moves caught my eye.”

Across the Atlantic, European Central Bank (ECB) board member Fabio Panetta suggested that the ECB should increase bond purchases or even increase the quota earmarked for them if needed to keep yields down. The euro was little changed after rising more than 0.3% during the previous session.

Source: Investing.com

The greenback sank to fresh lows against the Australian and Canadian dollars, and held near lows set overnight against its British and New Zealand peers.

Fed Chair Jerome Powell reiterated on Wednesday that the central bank wouldn’t adjust policy until the economy is clearly improving, and will look through any near-term spike in inflation. The remarks to the House of Representatives Committee on Financial Services mirrored his testimony before the Senate the day before.

“Powell made it very clear that the improvement in the economic outlook thus far will not instigate the Fed to tighten monetary policy,” National Australia Bank (OTC:NABZY) foreign exchange strategist Rodrigo Catril wrote in a client note.

“The punchbowl ain’t going anywhere anytime soon and the policy backdrop should remain supportive for risk assets for some time.”

Easy financial conditions, the promise of fiscal stimulus and an accelerating COVID-19 vaccine rollout have driven money into what’s known as the reflation trade, referring to bets on an upswing in economic activity and prices.

Commodity-linked currencies are placed to benefit from a pickup in global trade, while investors have also cheered Britain’s progress in recovering from the coronavirus pandemic.

“The dollar will probably weaken over time as economies pick up and the reflation trade gets more attention,” said Bart Wakabayashi, Tokyo branch manager of State Street (NYSE:STT) Bank and Trust.

“We’re seeing very strong upward pressure on prices in the U.S. in particular.”

Australia’s dollar traded at $0.79672 after earlier touching a fresh three-year high of $0.7978.

The Canadian dollar changed hands at its own three-year high of C$1.2502 per U.S. dollar.

The New Zealand was at $0.7434, just off Wednesday’s high of $0.7455.

Sterling rose 0.1% to $1.4161 after pushing to the cusp of $1.43 overnight for the first time since April 2018.

The euro traded near the top of its recent range at $1.2178, near the almost one-month high of $1.2180 touched earlier this week.

The dollar strengthened though against other traditional safe haven currencies, maintaining a two-day gain to trade at 105.875 yen and holding near the three-month high of 90.945 Swiss francs reached overnight.

Source: Investing.com