Market Talk – February 2, 2024

ASIA:

Japan is expected to experience a significant increase in annual interest payments on government debt, reaching 24.8 trillion yen ($169 billion) over the next decade, according to draft government estimates seen by Reuters. The Ministry of Finance prepared the latest estimate for parliamentary discussion on the government’s budget bills, highlighting the potential rise in financing costs as the central bank considers exiting crisis-mode stimulus. The Bank of Japan’s unconventional policies, including negative interest rates, have kept borrowing costs extremely low, supporting government debt.

The major Asian stock markets had a mixed day today:

• NIKKEI 225 increased 146.56 points or 0.41% to 36,158.02
• Shanghai decreased 40.59 points or -1.46% to 2,730.15
• Hang Seng decreased 32.65 points or -0.21% to 15,533.56
• ASX 200 increased 111.20 points or 1.47% to 7,699.40
• Kospi increased 72.85 points or 2.87% to 2,615.31
• SENSEX increased 440.33 points or 0.61% to 72,085.63
• Nifty50 increased 156.35 points or 0.72% to 21,853.80

The major Asian currency markets had a mixed day today:

• AUDUSD decreased 0.006 or -0.91% to 0.65090
• NZDUSD decreased 0.00779 or -1.27% to 0.60651
• USDJPY increased 2.1 or 1.43% to 148.520
• USDCNY increased 0.02721 or 0.38% to 7.21411

The above data was collected around 11:56 EST.

Precious Metals:

• Gold decreased 18.46 USD/t oz. or -0.90% to 2,036.43
• Silver decreased 0.49 USD/t. oz or -2.12% to 22.661

The above data was collected around 12:00 EST.

EUROPE/EMEA:

Germany’s lower house of parliament has approved the 2024 budget, adhering to the self-imposed debt brake. The budget, finalized after tense negotiations, allows Germany, the top economy in Europe, to issue 39 billion euros ($42.43 billion) in new debt, staying within the government’s set limit. The debt brake, a constitutional provision in Germany, limits the public deficit to 0.35% of the gross domestic product.

The major Europe stock markets had a mixed day today:

• CAC 40 increased 3.51 points or 0.05% to 7,592.26
• FTSE 100 decreased 6.62 points or -0.09% to 7,615.54
• DAX 30 increased 59.17 points or 0.35% to 16.918.21

The major Europe currency markets had a mixed day today:

• EURUSD decreased 0.00901 or -0.83% to 1.07819
• GBPUSD decreased 0.01266 or -0.99% to 1.26154
• USDCHF increased 0.01025 or 1.20% to 0.86765

The above data was collected around 12:54 EST.

US/AMERICAS:

The U.S. labor market saw a significant increase in January 2024, with 353,000 jobs added, surpassing economists’ expectations. The gains were widespread, with the health care and social assistance sector leading the way by adding over 100,000 jobs. Professional and business services also showed strength with an addition of 74,000 jobs, while manufacturing employment saw a notable increase of 23,000 jobs. However, the mining and logging sector experienced a loss of 7,000 jobs. The unemployment rate remained below 4% for the longest period since the 1960s, and average hourly wages rose unexpectedly fast, posing potential challenges for the Federal Reserve’s monetary policy.

US Market Closings:

• Dow advanced 134.58 points or 0.35% to 38,654.42
• S&P 500 advanced 42.42 points or 1.07% to 4,958.61
• Nasdaq advanced 267.31 points or 1.74% to 15,628.95
• Russell 2000 declined 11.69 points or -0.59% to 1,962.73

Canada Market Closings:

• TSX Composite declined 34.12 points or -0.16% to 21,085.09
• TSX 60 declined 1.06 points or -0.08% to 1,271.56

Brazil Market Closing:

• Bovespa declined 1,071.15 points or -0.83% to 127,409.87

ENERGY:

The oil markets had a mixed day today:

• Crude Oil decreased 1.458 USD/BBL or -1.98% to 72.362
• Brent decreased 1.317 USD/BBL or -1.67% to 77.383
• Natural gas increased 0.0309 USD/MMBtu or 1.51% to 2.0809
• Gasoline decreased 0.0323 USD/GAL or -1.47% to 2.1625
• Heating oil decreased 0.0411 USD/GAL or -1.51% to 2.6718

The above data was collected around 13:13 EST.

• Top commodity gainers: Sugar (1.61%), Rice (1.71%), Butter (4.29%) and Orange Juice (5.34%)
• Top commodity losers: Oat (-2.12%), Platinum (-2.44%), Crude Oil (-1.98%) and Silver (-2.12%)

The above data was collected around 13:19 EST.

BONDS:

Japan 0.665% (-3.2bp), US 2’s 4.39% (+0.197%), US 10’s 4.0504% (+18.74bps); US 30’s 4.24% (+0.140%), Bunds 2.237% (+9.7bp), France 2.744% (+9.8bp), Italy 3.821% (+10.4bp), Turkey 24.86% (+9bp), Greece 3.321% (+7.6bp), Portugal 2.955% (+8.4bp); Spain 3.168% (+9.1bp) and UK Gilts 3.917% (+16.8bp)

The above data was collected around 13:22 EST.