- US indices are trading lower mid-session. S&P 500 is down 0.2%, Nasdaq 100 loses 0.3% and Dow Jones declines 0.2%. The worst sentiment can be seen in the smaller cap stocks. Russell 2000 loses 0.8%.
- US 10 years treasury yields increased to 4.3% for the first time since the end of November. Therefore the prices of US bonds erased whole December gains. More aggressive growth could be seen on the German treasury market, where 10Y Germany Treasury yields increased by 7.8 bps to 2.2%.
- Wholesale inflation in the US came in higher than expected. PPI rose to 3% YoY (2.6% expected, 2.4% previously), while Core PPI climbed even higher (3.4%, expected: 3.2%, previously: 3.1%).
- US Initial jobless claims increased unexpectedly to 242k from 221k. Consensus estimated 221k, which might suggest that the American labor market is slightly worse off than previously expected. One week ahead of the next Fed's rate decision, the markets are betting 96% probability on 25 bp cut.
- Adobe’s shares plummeted 12.6% amid disappointing annual sales outlook for 2024. The revenue is expected to hit $23.4 bn, $0.4 bn short off analyst initial estimates.
- The performance of European indices is rather mixed. Italian FTSE MIB leads with its gain of 0.36%, followed by Swiss SMI (+0.29%), British FTSE 100 (+0.12%) and German DAX (+0.13%). On the red side we have Spanish IBX35 (-0.21%) and Polish WIG20 (-0.85%). French CAC40 remains flat.
- The ECB has lowered Eurozone key interest rates by 25 bp. ECB’s Lagarde has underlined that the monetary policy risks are double-sided, with growth concerns taking the lead and inflation outlook becoming progressively uncertain due to geopolitical tensions.
- Eurozone inflation is expected to firmly hit the 2% target in 2025. According to the ECB, the growth will take off slower than previously estimated.
- In the context of ECB’s interest rate decision, EURUSD breaks out of its downward momentum, gaining 0.1%.
- The Swiss National Bank unexpectedly decided to cut interest rates by 50 bp to 0.5%. The market prediction was 25 bps cut. As a result, the CHF depreciated by almost 0.5% and was the worst performer among G10 currencies.
- The Australian dollar was the strongest out of all G10 currencies. Its spot price increased by 0.33%. Appreciation could be also seen on the Norwegian krone, which saw an increase by 0.3%.
- On the crypto market we saw an increase in Ethereum price, which jumped by more than 3%. Therefore it came close to this years’ highest levels and key resistant levels around the psychological barrier of $4000.
- Precious metals trade lower today: gold and silver contracts take the hardest hit (-1.2% and -2.4% respectively), whilst palladium and platinum show a more moderate losses (-0,25% and -0,35% respectively).
