Stocks to Open Flat as Trade Pact Details Awaited: Markets Wrap
Asian stocks may open with caution on Thursday as investors awaited further details on a US-China trade accord. Softer-than-expected US inflation supported the case for Federal Reserve rate cuts, spurring Treasuries higher.
Asian equity futures held to muted moves early Thursday after the S&P 500 fell 0.3% Wednesday and the Nasdaq 100 dropped 0.4% as big tech weighed on US benchmarks. The declines halted a three-day advance for US stocks, with Apple Inc. down about 2%. In late hours, Oracle Corp. surged after revenue beat estimates. Contracts for US equities were little changed in early Asian trading.
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Associated Press
17 minutes ago
- Associated Press
Wall Street ticks closer to its record after Oracle rallies
NEW YORK (AP) — U.S. stock indexes ticked higher on Thursday following another encouraging update on inflation across the country. The S&P 500 rose 0.4% to pull back with 1.6% of its record. The Dow Jones Industrial Average added 101 points, or 0.2%, and the Nasdaq composite gained 0.2%. Oracle pushed upward on the market after jumping 13.3%. The tech giant delivered stronger profit and revenue for the latest quarter than analysts expected, and CEO Safra Catz said it expects revenue growth 'will be dramatically higher' in its upcoming fiscal year. That helped offset a 4.8% loss for Boeing after Air India said a London-bound flight crashed shortly after taking off from Ahmedabad airport Thursday with 242 passengers and crew onboard. The Boeing 787 Dreamliner crashed into a residential area near the airport five minutes after taking off. The cause of the crash wasn't immediately known. Stocks broadly got some help from easing Treasury yields in the bond market following the latest update on inflation. Thursday's said inflation at the wholesale level wasn't as bad last month as economists expected, and it followed a report on Wednesday saying something similar about the inflation that U.S. consumers are feeling . Wall Street took it as a signal that the Federal Reserve will have more leeway to cut interest rates later this year in order to give the economy a boost. The Federal Reserve has been hesitant to lower interest rates , and it's been on hold this year after cutting at the end of last year, because it's waiting to see how much President Donald Trump's tariffs will hurt the economy and raise inflation. While lower rates can goose the economy by encouraging businesses and households to borrow, they can also accelerate inflation. The yield on the 10-year Treasury fell to 4.35% from 4.41% late Wednesday and from roughly 4.80% early this year. Besides the inflation data, a separate report on jobless claims also helped to weigh on Treasury yields. It said slightly more U.S. workers applied for unemployment benefits last week than economists expected, and the total number remained at the highest level in eight months. That could be an indication of a rise in layoffs across the country. 'We believe that were it not for the uncertainty caused by the tariffs, the combined information coming from the inflation and labor-market data would have compelled the Fed to have resumed cutting its policy rate by now,' according to Thierry Wizman, a strategist at Macquarie. The Fed's next meeting on interest rates is scheduled for next week, but the nearly unanimous expectation on Wall Street is that it will stand pat again. Traders are betting it's likely to begin cutting in September, according to data from CME Group. Trump's on-and-off tariffs have raised worries about higher inflation and a possible recession, which had sent the S&P 500 roughly 20% below its record a couple months ago. But stocks have since rallied nearly all the way back on hopes that Trump will lower his tariffs after reaching trade deals with other countries. Many of Trump's tariffs are on hold at the moment to give time for negotiations, but Trump added to the uncertainty late Wednesday when he suggested the United States could send letters to other countries at some point 'saying this is the deal. You can take it or you can leave it.' On Wall Street, Chime Financial jumped 37.4% in its first day of trading on the Nasdaq. The technology company is trying to be the main financial hub for customers, connecting them with its bank partners. GameStop dropped 22.5% after saying it plans to raise $1.75 billion by borrowing at zero interest rates, though the lenders could choose to be repaid in the video-game retailer's stock instead of cash. All told, the S&P 500 rose 23.02 points to 6,045.26. The Dow Jones Industrial Average added 101.85 to 42,967.62, and the Nasdaq composite gained 46.61 to 19,662.48. In stock markets abroad, indexes were mixed across Europe and Asia amid mostly modest movements. Hong Kong's Hang Seng was an outlier, and it tumbled 1.4% to give back some of its strong recent gains. Hong Kong's index is still up nearly 20% for the year so far, towering over the U.S. stock market's gain of less than 3%. ___ AP Writers Matt Ott, Elaine Kurtenbach and Seung Min Kim contributed.
Forbes
19 minutes ago
- Forbes
How Gold Overtook The Euro As A Global Reserve Asset
Gold bars getty It's official - gold is now the world's second-most held reserve asset for central banks. That's after the European Central Bank confirmed the yellow metal had overtaken the euro on the back of feverish buying sprees over the last 12 months that have pushed its price to record highs. In a report published earlier this week, the ECB acknowledged that gold bullion accounted for 20% of global official reserves in 2024 versus the euro's 16% share. The uptick in holdings implies that gold is now second only to the U.S. dollar, which commands around half (46%) of world's reserve holding share. It seems the reason behind it all can be attributed to the ECB's own central banking peers. It noted in its report that: 'Central banks continued to accumulate gold at a record pace.' Among these, the top three buyers in 2024 were the central banks of Poland, India and Turkey. Russia and China also picked up the pace of their gold purchases too, among many other. In total, central banks acquired more than 1,000 tonnes of gold in 2024 or a fifth of the total global annual production. The said level of purchasing - of more than a 1,000 tonnes - has also been broadly similar for the third year in a row. What's more, while buying by central banks has continued at pace, their gold sales volumes have remained relatively 'modest', according to the World Gold Council. It also implies that major Western holders of gold - i.e. the U.S., U.K., Germany, France and Italy largely held on to the yellow metal. Overall, central bank gold reserves reached 36,000 tonnes in 2024, according to the ECB. The figure is tantalizingly close to the 38,000 tonnes in reserves recorded in the mid-1960s and the historic highs of the post-World War II Bretton Woods era. There are several reasons why the precious metals market is seeing the rising allure of gold among central banks while the ECB is having to confront the euro's diminished status among its peers. For starters, gold prices have hit record highs in recent years. In 2024 alone, gold rose by 26%. Last year's rally has continued unabated well in to the second quarter of this year, to the point that the yellow metal posted a record high of $3,500 per troy ounce, having surged by another 25% so far this year. Naturally, central banks are not just taking note of the gold price spike but also proactively partaking in keeping it higher. For gold is neither exposed to counterparty risk nor to international sanctions some central banks (e.g. Russia) ought to fret over. In fact, buying levels of more than 1,000 tonnes per year three years in a row are reminiscent of central banks' moves during the global financial crisis of 2008-09, and the subsequent transition to a low interest rate climate. Retail investors are playing their part too, by flocking to the yellow metal and gold exchange traded funds, seeking a safe haven in a volatile world that's having to contend with anxieties ranging geopolitical tension to trade wars. That's despite gold being a non-yielding asset, but admittedly one that is indeed highly liquid.
Bloomberg
40 minutes ago
- Bloomberg
Gold Market Competition Heats Up as Industry Meets in Singapore
The start of a gold-futures contract in Singapore has put the spotlight on fresh moves in Asian financial hubs to capitalize on rising interest in the commodity as demand increases and prices surge. The BlackRock Inc.-backed Abaxx Exchange began offering a US dollar-denominated futures contract, sized at 1 kilogram (32.15 troy ounces) and locally deliverable, on Thursday. The move will be among developments highlighted at an industry conference organized by the Singapore Bullion Market Association that'll take place in the city-state over three days from Sunday.
