Financial Markets Daily Report08 January 2024
Investors are starting the year cautiously as risk appetite seems to have eased over the holidays. As central bank officials tried to push market expectations of imminent rate cuts, although these expectations remain anchored in March for the Fed and April for the ECB, government bond yields rose across the board, particularly in the euro area.
- Investors are starting the year cautiously as risk appetite seems to have eased over the holidays. As central bank officials tried to push market expectations of imminent rate cuts, although these expectations remain anchored in March for the Fed and April for the ECB, government bond yields rose across the board, particularly in the euro area.
- The main equity indices from developed markets fell over the last two weeks amid low trading volumes, but this did not detract from a good year. On Friday, equities were mixed and rather flat: mostly lower in Europe and marginally higher in the US after payrolls data surprised to the upside, despite a slowdown in the services sector.
- In the currency market, the USD strengthened slightly over the holiday period as risk appetite cooled down, while the euro weakened a little against its major peers. In commodities, a significant cut in official oil prices to Asia by Saudi Arabia over the weekend should weigh on prices going forward, offsetting tensions in the Red Sea.