Forex News

The Ibovespa gained 1.51% to close at 126,526 on Friday, amid renewed optimism for interest rate cuts by the Bank of Brazil post-June. April’s IPCA mid-month inflation gauge exhibited a notable decline from the previous month and below expectations. The results, particularly favoring credit-sensitive equities, drove gains, with Americanas rising 5.45%, followed by Hapvida up 4.14%, Petz up 4.79%, and Hypermarcas gaining 4.42%. In earnings news, Multiplan reported quarterly net profit 28.9% higher than the previous year, pushing its shares up by 4.03%. However, Core PCE prices, the Fed’s preferred inflation measure, surpassed expectations, heightening anticipation of prolonged hawkish monetary policy, somewhat restraining the Ibovespa’s gains. For the week, the Ibovespa was on track to post gains of 1.12%.

The S&P/TSX Composite index rose 0.38% to close at 21,969 on Friday, lifted by commodity-related stocks, while investors scrutinized the latest US inflation data for insights into the Fed’s stance. Materials stocks surged by an average of 3.48%, with First Quantum Minerals leading the pack with a 12.5% increase, followed by Ero Copper rising 8.14%, and Ivanhoe Mines up by 5.93%. Amidst earnings reports, Agnico Eagle Mines surpassed first-quarter estimates, boosting their shares by 0.94%. Conversely, TFI International fell short of expectations, resulting in a 2.32% decline, and Imperial Oil’s quarterly results missed forecasts, causing their shares to drop by 0.82%. Meanwhile, core PCE prices, the Fed’s preferred inflation gauge, exceeded expectations year-on-year, fueling expectations for a prolonged period of restrictive monetary policy. The TSX saw a 0.74% rise in the week.

US stocks finished higher on Friday, driven by strong earnings reports from Alphabet and Microsoft, sending the tech-heavy Nasdaq 2% higher. The S&P 500 was up 1%, while the Dow Jones gained 153 points as investors brushed off concerns about elevated prices, especially after the latest data showed that the Fed's preferred inflation gauge continued to indicate persistent price pressures. Microsoft jumped 1.8% after surpassing forecasts for both earnings and revenue. Alphabet surged 10.2%, hitting all-time high of $171.95, after its upbeat results, and the company's announcement of its first dividend added to the positive sentiment. Conversely, Intel plunged 9.2% after providing a disappointing revenue outlook. ExxonMobil lost 2.8% after missing earnings expectations, while Chevron rose slightly as its profit came in below estimates. On the week, the S&P 500 and the Nasdaq gained 2.2% and 3.5%, respectively, their best weeks since November, while the Dow Jones rose by 0.5%.

Wheat futures traded around the $6 per bushel mark, near the over-three-month high of $6.2 touched on April 25th, driven by supply concerns from key producers. Dry weather conditions persist in southern Russia and the U.S. Plains, intensifying worries about crop yields and prompting investors to cover short positions in wheat. Additionally, the European Commission's downward revision of its forecast for the EU's main wheat crop has exacerbated these supply concerns, further fueling the rally in wheat prices. As a result, wheat prices have seen a substantial increase of over 9% for the week, representing the most significant surge since March 2022.

Top commodity gainers are Oat (3.42%), Orange Juice (2.49%) and Wool (1.21%). Biggest losers are Cotton (-2.87%), Wheat (-2.69%) and Corn (-2.66%).

Today's Metals commodities market is characterized by modest daily movements, with Copper standing out as the frontrunner with a 0.56% increase.

Top commodity losers are Natural gas (-3.82%), Natural Gas UK GBP (-2.45%) and Natural Gas EU Dutch TTF (-1.72%). Gains are led by Methanol (0.63%). In addition, there was a slight change on Brent Crude Oil (0.39%) and Crude Oil WTI (0.19%).

US stocks were trading higher on Friday afternoon, driven by strong earnings reports from Alphabet and Microsoft, sending the tech-heavy Nasdaq over 2% higher. The S&P 500 was up 1.2%, while the Dow Jones gained over 200 points as investors brushed off concerns about elevated prices, especially after the latest data showed that the Fed's preferred inflation gauge continued to indicate persistent price pressures. Microsoft jumped 2.7% after surpassing forecasts for both earnings and revenue. Alphabet surged 10% following its results beating estimates, and the company's announcement of its first dividend added to the positive sentiment. Conversely, Intel plunged 10% after providing a disappointing revenue outlook. ExxonMobil lost 2.4% after missing earnings expectations, while Chevron fell slightly as its profit came in below estimates. On the week, the S&P 500 and the Nasdaq are set to gain 2.4% and 3.8%, respectively, its first positive week in five, while the Dow Jones rose by 0.6%.

In the US, all eyes will be on the Fed's interest rate decision on Wednesday, followed closely by the labor market report on Friday. Also, investors will be scrutinizing ISM Manufacturing and Services PMI’s, alongside JOLTs job openings data, foreign trade figures, factory orders, and CB consumer confidence index. Earnings season will reach its zenith with reports from heavyweight Amazon, Eli Lilly, Coca-Cola, McDonald's, Mastercard, Qualcomm, Pfizer, ADP, Apple, ConocoPhillips, Amgen, Booking, and Cigna. Internationally, April inflation rates for Germany, Spain, the Netherlands, France, the Euro Area, Italy, South Korea, Switzerland, Indonesia, and Turkey will be closely watched. Furthermore, flash Q1 GDP growth rates are set to be released for France, Spain, Germany, Italy, the Euro Area, Mexico, Saudi Arabia, and Hong Kong. Finally, S&P Global will publish manufacturing PMIs for China, Canada, Spain, Italy, South Korea, Russia, and Switzerland.

The Mexican peso strengthened toward 17.1 per USD, rebounding from a five-month low of 17.2 on April 25th, as investors analyzed economic data for insights into Mexican and US central bank policies. March’s domestic unemployment rate fell to 2.3%, below market expectations at 2.4% and the lowest since 2001, giving the Bank of Mexico room to consider slowing its easing cycle to address inflation. April’s mid-month inflation data showed persistence, with the gauge reaching 4.63%, surpassing expectations. Additionally, economic activity in Mexico surged by 4.4% year-on-year in February 2024, the strongest growth since October. Still, elevated inflationary pressures and a robust labor market in the US increased hawkish sentiments for the Fed and supported the greenback, limiting the peso’s recovery.

The JSE index extended early gains to close about 1.4% up at 75,371 on Friday, a leven not seen since mid-April, mirroring global peers. The bullish market sentiment was mainly driven by upbeat earnings from big US tech companies. Meanwhile, the latest PCE data suggested that inflation remains sticky, corroborating the Fed's narrative of "higher for longer" interest rates. Domestically, an Ipsos opinion poll released today aligns with several other surveys, which indicate that support for the ANC could drop below 50% for the first time since 1994. On the corporate front, financials and industrials were the top performers. Meanwhile, state-owned Transnet has reported a 1.5% year-on-year improvement in the total rail volumes reaching 51.7 million tonnes at the end of March 2024, showcasing improvement in operational performance. For the week, the JSE added about 2.7%.

In Milan, the FTSE MIB Index gained 296 points or 0.87 percent on Friday. Gains were led by Banca Monte dei Paschi di Siena (4.04%), Prysmian (3.52%) and Iveco Group (2.72%). Biggest losers were Tenaris (-7.98%), STMicroelectronics (-1.80%) and Hera (-0.94%).

In Frankfurt, the DAX Index went up by 277 points or 1.54 percent on Friday. Top gainers were Siemens Energy (5.42%), Puma (4.18%) and Sartorius (3.40%).

In Paris, the CAC 40 Index rose 82 points or 1.02 percent on Friday. Leading the gains are Saint-Gobain (6.88%), Kering (3.25%) and Schneider Electric (2.81%).

In London, the FTSE 100 Index gained 74 points or 0.92 percent on Friday. Gains were led by Natwest (5.80%), Ashtead (5.26%) and Anglo American (4.22%). Biggest losers were Convatec Group (-6.60%), Beazley (-3.08%) and Entain (-2.87%).

AbbVie decreased to a 15-week low of 159.95 USD. Over the past 4 weeks, AbbVie lost 11.2%, and in the last 12 months, it increased 7.58%.

Canada's government budget surplus decreased to CAD 8.34 billion in February 2024 from CAD 9.53 billion in the same month of the previous year, and marking the first surplus since June. In the first eleven months of the 2023/24 fiscal year (April-February), the country recorded a deficit of CAD 17.3 billion, a significant decrease from the CAD 3.1 billion surplus reported in the same period a year earlier. Program expenses surged by 6.7% across all major spending categories, while public debt charges spiked by 36.5% due to higher interest rates. On the other hand, government revenues increased by 3.1%, driven by growth in personal income tax revenue and other taxes and duties.

Government bond yields are trading lower on Friday. Top gainers are Russia 10Y (18.50bps), Japan 10Y (3.04bps) and New Zealand 10Y (1.70bps). Biggest losers are South Africa 10Y (-12.70bps), Greece 10Y (-12bps) and Italy 10Y (-10.10bps).

The Ibovespa gained 1.2% on Friday, hovering below the 124,200 level, amid renewed optimism for interest rate cuts by the Bank of Brazil post-June. April’s IPCA mid-month inflation gauge exhibited a notable decline from the previous month and below expectations. The results, particularly favoring credit-sensitive equities, drove gains, with Petz rising 8.5%, followed by Hapvida up 4.4%, and JBS up 3.6%. In earnings news, Multiplan reported quarterly net profit 28.9% higher than the previous year, pushing its shares up by 5.4%. However, Core PCE prices, the Fed’s preferred inflation measure, surpassed expectations, heightening anticipation of prolonged hawkish monetary policy, somewhat restraining the Ibovespa’s gains. For the week, the Ibovespa was on track to post gains above 0.9%.

The Baltic Exchange's main sea freight index, a measure of global shipping costs, extended losses for the fifth successive day on Friday, falling about 1.3% to an over two-week low of 1,721 points. The capesize index, which typically transports 150,000-ton cargoes such as iron ore and coal, was down for the sixth straight session, dropping by 2.6% to its lowest since April 10th at 2,172 points; and the panamax index, which usually carries about 60,000-70,000 tons of coal or grain cargo, decreased by 1% to its lowest point since April 17th. Among smaller vessels, the supramax was up by 7 points to 1,495 points. The benchmark index declined above 10% for the week, on the back of lower demand in larger vessels.