World Markets

World Markets12 April  2022  

World Market – Headlines  

  • The dollar index has risen beyond 100 points ahead of predicted strong inflation data from the United States.

  • As markets prepare for critical US inflation data, Asian stocks are shaky and the dollar is robust.

  • As OPEC warns of tight supply and Russian penalties loom, oil prices rise.

World Markets

Currency

Indian Rupee

USD/INR Spot (75.9450): Yesterday, the USD/INR began at 75.91, close to the previous day’s close of 75.8950. Following the opening, the pair strengthened to 75.79 levels, owing to exporters hedging their receivables and substantial dollar inflows from IT firms. Later, dollar demand from oil companies near 75.80 levels, combined with bearish sentiment in Asian stocks, pushed the pair to 76.09 levels before closing at 75.95.

Market pricing boosted the likelihood of a 50 basis point interest rate hike by the Federal Reserve in May 2022, causing US equities to close down (-1.19 percent). According to the minutes of the most recent FED meeting, the Fed is considering taking a more aggressive approach to monetary policy tightening. Brent Oil Oil prices are hovering around $100 per barrel, despite China’s COVID lockdown and the market’s disclosure of increased crude supplies last week.

Intraday resistance for the USD/INR is at 76.0450 and 76.1550. It must close above 76.20 on a daily basis to signal the probability of further gains towards the 76.58 region. If the pair stays below 76.0450, it will drop to the 75.75-75.79 zone. If this support is broken, the next major support, at 75.6450 levels, may be tested.

The day’s range is 75.7200 to 76.1550.

Other Currencies

On Tuesday morning, the dollar index was back over 100, boosted by high US yields ahead of inflation data that is likely to show the most significant increase in US prices in over 16 years, bolstering expectations of aggressive Fed tightening policy.

The index was trading at 100.11, close to a two-year high of 100.19 set last week.

The dollar’s gains have been particularly noticeable versus the yen, which was trading choppy at 125.47 yen on Tuesday morning, just off the overnight intraday high of 125.77, when it was approaching its June 2015 top of 125.86. If the dollar rises beyond that level, it will reach its best level versus the yen since 2002.

On the offshore Chinese yuan, the dollar rose steadily overnight, reaching a two-week high of 6.390 in early trade.

Lower oil prices dragged on the Australian dollar, which was trading at $0.7403, putting the commodity-linked currency on the back foot.

The New Zealand dollar fell to $0.6807 ahead of the Reserve Bank of New Zealand’s meeting, which is expected to result in a 50 basis point rate hike.

The value of the pound fell to $1.30155.

Equity

Indian Equity

The broader index is expected to open lower on Tuesday, with a loss of 137 points, according to SGX Nifty trends.

On Monday, the BSE Sensex slid 483 points to 58,965, while the Nifty50 dropped 109 points to 17,675 and formed a bearish candle on the daily charts.

The pivot charts show that the Nifty’s main support level is 17,624, followed by 17,573. The important resistance levels to watch for if the index rises are 17,752 and 17,830.

Other Markets

On Tuesday, Asian stocks fell and the dollar rose, as Treasury yields rose to a three-year high ahead of US inflation data that could signal even more aggressive interest rate hikes from the Federal Reserve.

After U.S. stocks concluded the previous session with minor losses, MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.3 percent.

The Australian stock market was down 0.65%, while Japan’s Nikkei stock index was down 1.5%.

In early trade on Tuesday, Hong Kong’s Hang Seng Index rose 0.6 percent, while China’s bluechip CSI300 Index rose 0.4 percent.

The Dow Jones Industrial Average plummeted 1.19 percent, the S&P 500 slid 1.69 percent, and the Nasdaq Composite plunged 2.18 percent on Monday. The S&P 500’s 11 sectors all declined.

The Shanghai composite fell 0.17 percent in early trading, while the Shenzhen component rose slightly.

The Nikkei 225 index in Japan fell 1.2 percent after shares of robot manufacturer Fanuc fell more than 4%. The Topix index fell by 1.04 percent today.

The Kospi in South Korea fell 0.87 percent.

Australian equities fell as well, with the S&P/ASX 200 index falling 0.51 percent.

The price of gold was marginally lower. Gold was trading at $1951.45 per ounce on the spot market.

OIL

Oil prices gained early Tuesday, recovering significant losses the day before, as the market considered the possibility of more sanctions against Russia’s energy sector, and OPEC cautioned that increasing output sufficiently to compensate for lost supply would be hard.

Brent oil futures were up 85 cents, or 0.9 percent, to $99.33 a barrel, while WTI contracts in the United States were up $1.04, or 1.1 percent, to $95.33 a barrel.

Crude oil in the United States rose 0.85% to $95.09 a barrel. Brent crude is now trading at $99.18 a barrel.

Economic Events

Economic Calendar

Tuesday, Apr 12, 2022

Time

Country

Event

Forecast

Previous

11:30

GBP

Claimant Count Change (Mar)

 

-48.1K

11:30

GBP

Average Earnings Index +Bonus (Feb)

5.40%

4.80%

14:30

EUR

German ZEW Economic Sentiment (Apr)

-48

-39.3

18:00

USD

Core CPI (MoM) (Mar)

0.50%

0.50%

21:30

USD

EIA Short-Term Energy Outlook

 

 

 

 

Prepared by

Anushree Saxena(Intern)

 

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Disclaimer: All information in this report is collected from various sites on the internet. Although we have taken all precautions for the correct representation of data however we do not take any responsibility for any errors and omissions. The technical analysis and views expressed are the author’s own views. We are not responsible for any losses on account of following the same.

Sources

https://www.reuters.com/

https://in.investing.com/