Morning wrap (13.11.2024)

Indices from the Asia-Pacific region are trading mostly higher. Chinese indices are gaining between 1.10% and 1.90%. Japan's Nikkei 225 index is down 1.10% to 38,750 points, while Singapore's SG20cash index futures are up 0.65%.

Indices in the US closed lower, experiencing moderate declines. The US500 index returned below the 6,000-point level, with the largest sell-off seen in the US2000 small-cap index.

The stock market sell-off in the US was mainly noticeable in instruments that had gained the most during the last Trump Trade, perceived as potential beneficiaries of Donald Trump's return to the White House.

Shares of Tesla (TSLA.US), which had risen by about 30% since election day, fell more than 6% yesterday, while Trump Media & Technology Group (DJT.US) shares dropped by nearly 9%.

However, the reversal of the Trump Trade was only evident in the stock market since the dollar continues to gain and remains one of the stronger currencies today. The USDIDX index is up 0.16% to 106 points. On the other hand, one of the weakest currencies is the Japanese yen, losing about 0.3%–0.4%. USDJPY is up 0.35% today to 155.0700.

The most important event today will be the release of the US CPI report. Analysts' expectations indicate a slight increase in headline inflation and no change for core inflation on a yearly basis.

Earlier today, we saw the release of Australia's wage growth report for Q3 2024. Wage growth in Australia slowed in the last quarter, reflecting an easing of price pressures across the economy and strengthening expectations for an interest rate cut at the next RBA meeting. However, according to analysts, a one-time decline in prices will not be sufficient for the RBA, with the earliest possible easing of monetary policy likely in the first quarter of 2025.

The wage price index rose 3.5% year-on-year for the three months to September, compared to 4.1% in the previous period and economists' estimates of 3.6%. On a quarterly basis, wages increased by 0.8%, slightly less than forecast.

Japan's producer price index (PPI) rose by 3.4% in October compared to the same period last year, exceeding analysts' expectations. On a monthly basis, PPI increased by 0.2%.

In the cryptocurrency market, we are also seeing partial profit-taking. Bitcoin is down 1.25% to 87,000 USD at the time of publication. The altcoin market (ex Eth and BTC) and Ethereum are recording sharper declines, with losses of 3.80% and 2.70%, respectively.