Jamie McGeever
7 min read
In This Article:
By Jamie McGeever
ORLANDO, Florida (Reuters) - TRADING DAY
Making sense of the forces driving global markets
By Jamie McGeever, Markets Columnist
Key equity, bond, currency and commodity prices mostly ended little changed on Wednesday, as investors digested the fast-moving developments in the Middle East and the Federal Reserve's latest policy decision and guidance.
In my column today I explain why the Bank of Japan's cautious approach to reducing its balance sheet will help keep domestic real rates and yields deeply negative, and keep Japanese money overseas. More on that below, but first, a roundup of the main market moves.
If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today.
1. Early Fed chair nomination could rattle markets 2. Dollar exit could be crowded for some time: Mike Dolan 3. UK inflation slows but oil price jump creates newproblem for Bank of England 4. China talks up digital yuan in push for multi-polarcurrency system 5. Texas Instruments plans $60 billion U.S. investment amidTrump's onshoring push
Today's Key Market Moves
* Oil prices end a volatile session slightly higher,recovering losses of around 2% earlier in the day. Brent crudesettles at $76.70/bbl, WTI at $75.14/bbl. * Wall Street's three main indices end essentially flat,although the Russell 2000 small cap index rises 0.6%. * U.S. Treasury yields fall 1 basis point or less across thecurve. * The dollar edges higher but only just. The Swiss franc isone of the biggest movers in G10 FX, slipping 0.3% ahead ofThursday's SNB meeting. * Gold fails to scale $3,400/oz for a second day, but thebig mover in precious metals is platinum, leaping 4% to an11-year high of $1,329/oz on continued strong demand from China.Platinum is up around 25% so far this month.
Markets calm in eye of hurricane
With the Israel-Iran war entering its sixth day, President Donald Trump leaving the world hanging over his next move and Washington's involvement in the conflict, and the Federal Reserve flagging rising 'stagflation' risks, world markets were remarkably calm on Wednesday.
At least, they were calm by the end of U.S. trading, regaining their poise after some intra-day turbulence and settling pretty close to where they ended the previous day.
In some ways, this was surprising, given the newsflow.
Iranian Supreme Leader Ayatollah Ali Khamenei rejected Trump's demand for unconditional surrender, and the U.S. president said his patience had run out. Asked if he had made a decision on whether to join Israel's bombing of Iran, Trump said: "I may do it. I may not do it. I mean, nobody knows what I'm going to do."
