Markets rebound as China announced more stimulus measures - 15.9.2023

The Dollar strengthening has halted today. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, gained 0.8% on Thursday while the Department of Labor data showed the number of Americans who sought unemployment benefits over the last week was lower than the forecast while their number rose.

Both EUR/USD and GBP/USD accelerated their sliding on Thursday despite the European Central Bank’s surprise 25 basis point hike of its main rate to 4%, a 10th consecutive hike. Both euro and Pound are higher against the dollar currently. AUD/USD joined USD/JPY’s slowed climbing yesterday with the yen lower against the Greenback currently and the Australian dollar higher.

US stock indexes futures are up currently as the yield on benchmark 10-year Treasury notes ticked down to 4.279%. The three main stock benchmarks ended higher on Thursday in the narrow range of 0.8% to 0.96% as stronger than expected US retail sales data pointed to continued resilience in the world’s largest economy.

European stock indexes are higher currently after closing solidly higher on Thursday led by basic resources stocks. Asian stock indexes futures are mostly higher today with Hong Kong’s Hang Seng leading gains while the People’s Bank of China cut its reserve ratio requirements for local lenders by 25 basis points- its second such move this year. At the same time data showed Chinese industrial production and retail sales grew more than expected in August.

Brent is extending gains currently. Prices ended sharply higher yesterday despite the bearish US inventories report on Wednesday of 4 million barrels build up last week. The US oil benchmark West Texas Intermediate (WTI) jumped 1.85% and is higher currently. Brent rallied 1.98% to $93.70 a barrel on Thursday.