Morning Wrap (25.04.2024)

Asia-Pacific stock indexes are having a mixed session. Chinese indexes are gaining the most, with the CHN.cash index up 0.96% and the HK.cash index up 1.05%. The index in Singapore, SG20cash, is down by 0.21%, in Vietnam, VIET30 is also down by 0.23%, and in Japan, JAP225 is down by 1.12%.

Futures contracts for European indexes also indicate a slightly lower opening for the cash session on the Old Continent. Contracts for indexes from Germany and the UK are losing between 0.10%-0.30%.

In the forex market in the first part of the day, movements are limited, with most changes for major currency pairs ranging within +/-0.10%. An exception is the Japanese yen (JPY), which is losing about 0.3-0.4%.

The USDJPY currency pair is up 0.30% to a new record level around 155.7000.

Taiwan's President-elect Lai Ching-te announced his cabinet and security team on Thursday, preparing to take office next month.

China, which claims that Taiwan governed by it is part of its territory and has declared that it will not renounce the use of force to take control, has called the new Taiwanese president a dangerous separatist.

Lai Ching-te stated that Beijing will not gain support from Taiwanese public opinion if it is willing to cooperate with the Taiwanese opposition, referring to the main opposition Kuomintang (KMT) party on the island, whose senior leaders have often visited China in recent months.

Stever Barrow, head of G-10 strategy at Standard Bank, claims that the Bank of Japan could intervene in the forex market on the USDJPY pair as early as Friday. He believes that the Bank of Japan might discuss intervention at a meeting on Friday. The intervention could occur during American hours or shortly thereafter.

Japan's Cabinet Secretary Yoshimasa Hayashi emphasized readiness for full intervention, noting undesirable sharp movements in the forex market on Thursday. He added that he expects close cooperation between the Bank of Japan (BoJ) and the government in conducting appropriate monetary policy.

South Korea's economic growth accelerated more than expected in the last quarter. Gross domestic product grew by 1.3% in the three months to March compared to the previous quarter, against a consensus of 0.6%. On an annual basis, the economy grew by 3.4%, also more than forecasted at 2.5%.

In cryptocurrencies, we observe a continuation of declines after yesterday's return below 67,000 USD in the second part of the day. Today, Bitcoin is down 0.20% to a level of 64,130 USD. Altcoins are losing slightly more, with the total market capitalization excluding BTC and ETH currently at 653 billion USD.