The morning market overview, compiled by Dow Jones Newswires:
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+++++ DAILY THEME +++++
Taiwan Semiconductor Manufacturing ended 2024 with another record quarter and increased net profit by 57 percent to 374.68 billion New Taiwan dollars, the equivalent of approximately 11.06 billion euros. Analysts had a consensus of 370.64 billion Taiwan dollars. Sales rose 39 percent year-on-year to 868.46 billion Taiwan dollars and for the full year to 2.894 trillion. The latter represents an increase of 34 percent compared to 2023. The gross margin was 59 percent, within the company’s forecast range of 57 to 59 percent.
+++++ COMPANY OUTLOOK ++++++
11:55 US/Unitedhealth Group Inc, 4Q earnings
12:45 US/Bank of America Corp, 4Q earnings
13:30 US/Morgan Stanley, 4Q results
+++++ ECONOMIC OUTLOOK +++++
– US
2:30 p.m. retail sales December
FORECAST: +0.5% yoy
previously: +0.7% yoy
Retail sales ex motor vehicles
FORECAST: +0.4% yoy
previously: +0.2% yoy
Initial applications for unemployment assistance (week)
FORECAST: 210,000
previously: 201,000
Import and export prices December
Import prices
FORECAST: -0.1% yoy
previously: +0.1% yoy
Philadelphia Fed Index January
FORECAST: -6.0
previously: -16.4
4:00 p.m. Stock levels November
FORECAST: +0.1% yoy
previously: +0.1% yoy
+++++ OVERVIEW INDICES +++++
Level +/- %
E-Mini Future S&P-500 5,996.00 +0.1%
E-Mini Future Nasdaq-100 21,430.75 +0.1%
Nikkei-225 38,692.75 +0.6%
Hang Seng Index 19,494.91 +1.1%
Kospi 2,527.49 +1.2%
Shanghai Composite 3,232.41 +0.2%
S&P/ASX 200 8,327.00 +1.4%
+++++ FINANCIAL MARKETS +++++
EAST ASIA (HISTORY)
Fester – After the favorable US producer prices for December on Wednesday, things are going up on the East Asian stock exchanges and in Sydney on Thursday. They are following Wall Street, where the improved prospects of interest rate cuts by the US Federal Reserve thanks to the price data led to very strong price gains, particularly for the technology-heavy and therefore more interest rate-sensitive Nasdaq indies. The Nikkei 225 index in Tokyo is only making slight progress after higher gains in early trading. It is being held back by the prospect of rising interest rates in Japan, something that the Bank of Japan’s leadership has only just sent out signals about. Accordingly, the yen continues to appreciate, which also has a slowing effect on share prices. There is now increasingly one on the market Interest rate increase but played in January and not just in March. In Seoul, the fact that the South Korean central bank surprisingly did not lower key interest rates is not a burden. In trade, on the one hand, the unstable political development is referred to as a background, and now there is also one Interest rate cut very likely at the next meeting of the central bankers. The Shanghai Composite is barely moving ahead of the GDP data from China due on Friday night. Sydney was unfazed by strong Australian jobs data, traders said, raising the bar for the Australian central bank to cut interest rates in February.
WALL STREET
INDEX last +/- % absolute +/- % YTD
DJIA 43,221.55 +1.7% 703.27 +1.6%
S&P 500 5,949.91 +1.8% 107.00 +1.2%
Nasdaq Comp. 19,511.23 +2.5% 466.84 +1.0%
Nasdaq-100 21,237.85 +2.3% 480.44 +1.1%
Sales data
Wednesday Tuesday
Turnover NYSE (stocks) 1,016 million 933 million
Winners 2,370 2,118
Loser 434 662
Unchanged 33 65
Firm – The lower core rate increase in US consumer prices in December and convincing business figures from the banking sector created a buying mood. The market now sees more scope for interest rate cuts in the USA, especially since producer prices had already remained well below forecasts the day before. Overall, technology stocks were favored, also because they are considered to be more sensitive to interest rates given their valuations. JP Morgan increased its profits significantly and exceeded analysts’ expectations; the share price rose by 2.0 percent. Goldman Sachs rose 6.0 percent after fourth-quarter profit rose more than expected. Wells Fargo (+6.7%) also earned more in the quarter than analysts had estimated, as did Citigroup (+6.5%), which returned to the black. One market participant spoke of a “very strong development” with regard to Blackrock (+5.2%). The asset manager was entrusted with record sums in 2024. Microsoft is preparing to prepare for quantum technology in 2025, and the share price rose by over 2 percent. The prices of technology providers such as D-Wave Quantum and Quantum Computing jumped by 22.4 and 55.5 percent, respectively.
US BONDS
Maturity Yield Bp to VT Yield VT +/-Bp YTD
2 years 4.26 -11.0 4.38 2.5
5 years 4.44 -15.1 4.59 6.3
7 years 4.55 -14.9 4.70 6.7
10 years 4.65 -14.1 4.79 7.8
30 years 4.87 -10.6 4.98 9.2
Yields plummeted after the recent rise as interest rate cut fantasies were fueled by favorable US consumer prices in December.
CURRENCY
last +/-% 00:00 Wed, 8:15% YTD
EUR/USD 1.0287 -0.1% 1.0292 1.0292 -0.7%
EUR/JPY 160.75 -0.1% 160.95 161.84 -1.3%
EUR/GBP 0.8420 +0.1% 0.8410 0.8446 +1.8%
GBP/USD 1.2217 -0.2% 1.2239 1.2185 -2.4%
USD/JPY 156.28 -0.1% 156.37 157.21 -0.6%
USD/KRW 1,457.08 +0.2% 1,454.74 1,462.25 -1.3%
USD/CNY 7.1926 +0.0% 7.1913 7.1889 -0.2%
USD/CNH 7.3494 +0.0% 7.3483 7.3472 +2.0%
USD/HKD 7.7880 +0.0% 7.7872 7.7897 +0.3%
AUD/USD 0.6205 -0.3% 0.6227 0.6192 +0.3%
NZD/USD 0.5603 -0.2% 0.5615 0.5602 +0.1%
Bitcoin
BTC/USD 99,802.75 +0.1% 99,725.25 97,133.15 +5.4%
YTD based on the closing price of the previous day
The dollar fell slightly. In an initial reaction to the core rate increase in US consumer prices, which was below expectations, it fell somewhat more significantly, but then recovered again.
++++ RAW MATERIALS +++++
OIL
most recently VT Settlem. +/-% +/- USD% YTD
WTI/Nymex 80.15 80.04 +0.1% +0.11 +11.8%
Brent/ICE 82.10 82.03 +0.1% +0.07 +9.7%
YTD based on the closing price of the previous day
Prices on the oil market rose sharply by up to almost 4 percent. The tightened sanctions against Russia also provided support. Reference was also made to the cold weather in parts of the USA and Europe and also to crude oil inventories in the USA. These fell more significantly than expected in the week ending January 10th.
METALS
last day previous +/- % +/- USD % YTD
Gold (spot) 2,692.39 2,700.03 -0.3% -7.65 +2.6%
Silver (spot) 30.74 30.63 +0.4% +0.12 +6.5%
Platinum (spot) 941.95 940.75 +0.1% +1.20 +3.9%
Copper future 4.40 4.39 +0.3% +0.01 +9.3%
YTD based on the closing price of the previous day
The sharp fall in market interest rates gave interest-free gold an influx. The price per troy ounce rose by 0.7 percent.
+++++ REPORTS SINCE WEDNESDAY 8:00 PM +++++
AUSTRALIA
The Australian economy has once again shown strong job growth. 56,300 jobs were created in December, almost four times what economists had expected. The unemployment rate nevertheless rose to 4.0 from 3.9 percent in the previous month. This increases doubts about an interest rate cut by the Australian central bank in February.
JAPAN – monetary policy
The Japanese central bank could raise interest rates next week. Gov. Kazuo Ueda reiterated his promise to discuss an increase at the council meeting. “If improvements in the economy and prices continue this year, we will adjust the level of monetary easing by raising interest rates,” he told a meeting of regional bank managers. Earlier in the week, both Ueda and his deputy said a rate hike was on the table at the meeting on January 23rd and 24th.
SOUTH KOREA – Monetary policy
The South Korean central bank surprisingly refrained from cutting interest rates further and kept the key interest rate stable at 3.0 percent. The vast majority of economists had expected a further cut of 25 basis points.
USA – monetary policy
Federal Reserve Bank of Chicago President Austan Goolsbee still expects inflation to decline this year, but noted some uncertainties and risks emerging.
USA – economy
(MORE TO FOLLOW) Dow Jones Newswires
January 16, 2025 01:45 ET (06:45 GMT)