Morning Wrap (11.07.2024)

Asian and Pacific indices are mostly experiencing a bullish session driven by a record cash session close on Wall Street. Chinese indices are up between 1.50-1.65%, and Japan's Nikkei 225 index is up 1.10% above 42,300 points.

The Nasdaq and S&P 500 reached record-high closes on Wednesday, driven by gains in Nvidia and other AI and tech sector companies. Nvidia gained 2.70% to $134.90 per share at the session's close. Today, investors' focus will be on the US CPI inflation report for June.

Futures on European indices indicate a mixed opening for the cash session on the Old Continent. The UK100 is up 0.10%, while the DAX is flat.

In the forex market, the New Zealand dollar and the Australian dollar are the biggest gainers in the first part of the day, with increases between 0.1-0.3%. The Japanese yen is again one of the weaker currencies. USDJPY is up 0.10% to 161.7000 JPY per USD.

AMD (AMD.US) announced on Wednesday the acquisition of the European AI lab Silo AI in a cash transaction worth $665 million. AMD aims to enhance the competitiveness of its products and further compete with Nvidia (NVDA.US) in the field of artificial intelligence.

Japan's monthly machinery orders report came in lower than expected at 3.2% m/m (-2.9% m/m previously). However, the data was better on an annual basis, at 10.8% y/y (previously 0.8% y/y). This report is used as a leading indicator of capital expenditures in the upcoming 6-9 months.

Inflation in the United States should continue to decline without a significant further increase in the unemployment rate, said Federal Reserve Governor Lisa Cook on Wednesday during an economic conference in Australia. Lisa Cook's baseline scenario is still a soft landing, although this has been rare in previous decades.

South Korea's central bank left interest rates unchanged at 3.50%. The board unanimously decided on Thursday to maintain the seven-day repurchase rate, as forecast by all 22 economists surveyed by Bloomberg. In a statement, however, the bank opened the way for cuts in the coming months, indicating that it would be necessary to analyze the convenient timing of such a move.

Bank of Korea Governor Rhee Chang-yong has sought to rein in speculative market moves based on assumptions of short-term policy returns. Market expectations for a cut are somewhat exaggerated, Rhee said during a news briefing.

There are no significant changes in the cryptocurrency market, with Bitcoin trading at $57,800, around the levels seen in the second half of yesterday. Slight declines can be observed in the Altcoin and Ethereum markets.