Although the ECB has identified wages as the main risk in its fight against inflation, the markets seem immune to this concern.
European stocks are trading near all-time highs, highlighting stability and strength in the markets. The European index STOXX 600 registers a slight decrease of 0.1%remaining less than 1% from its all-time high reached in early 2022, while S&P 500 futures show a drop of 0.3%.
Simultaneously, The Japanese Nikkei index distances itself from the all-time high of 1989, closing with a slight decrease of 0.3%. Within the euro zone, recent figures from the European Central Bank (ECB) reveal that annual wage growth slowed down to 4.5% in the last quarter of 2023, slightly below the previous quarter’s record 4.7%.
Although the ECB has identified wages as the main risk in its fight against inflation, the markets seem immune to this concern. The 10-year German bond yield fell 2 basis points to 2.38%, while the euro rose slightly to $1.0798.
On the corporate front, shares in British lender Barclays rose 4% after reporting fourth-quarter results and announcing a three-year plan to revitalize its listing, which includes cutting £2 billion in costs.
Mixed results in Asia and expectation for data in the US
In Asia, the recent interest rate cut in China caused mixed results. The five-year lending rate fell 25 basis points to 3.95%, while blue chips saw a rise of 0.2%, and Hong Kong’s Hang Seng Index rose 0.6%. However, The yuan hit its lowest level in three months before stabilizing at 7.1979 units per dollar.
Globally, the yield on 10-year US Treasury bonds falls 1 basis point to 4.28%, while the dollar strengthens, exceeding 150 yen. In the commodities market, Brent crude futures decline around 0.3% to $83.31 per barrel, while gold trades in a stable range of $2,022.7 per ounce.
In the agricultural sector, grains start the week lower, with wheat futures hitting their lowest level in three months due to abundant supplies from the Black Sea. In contrast, short covering drives soybean futures to one-week highs.
Source: Ambito
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