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Asian stocks and Yen show resilience

May 3, 2024

Key points

  • Asian equity markets saw an uplift, driven by Apple’s announcement of a $110 billion share buyback plan that bolstered the technology sector. 
  • Japanese yen experienced a recovery, distancing itself from recent 34-year lows.

Asia-Pacific stock indices surge despite market closures

Despite the closure of markets in Japan and mainland China, the regional stock indices responded positively, with MSCI’s broadest index of Asia-Pacific shares outside Japan climbing 1.5%, poised for a consecutive weekly rise. Hong Kong’s Hang Seng Index notably advanced by 2%, tracking towards a weekly increase of 5%.

See what happened recently: Asian Stocks Show Mixed Performance Amid Global Economic Tensions 

Yen strengthens against dollar

The yen showed a strengthening of 0.55% to 152.80 against the dollar early Friday, a recovery from Monday’s 34-year low of 160.245. Market whispers suggest Tokyo might have injected approximately $60 billion this week to support the yen, keeping traders vigilant for more interventions, especially given the upcoming series of Japanese public holidays and a holiday in the UK.

Chart of USDJPY on the VT Markets trading app. Yen is shown here strengthening against the USD.

Picture: Yen shows resilience against the dollar. See in real-time on the VT Markets app.

On the US front

The U.S. dollar index, which measures the currency against six major peers, dipped to 105.25, marking a 0.7% decline for the week, its most substantial drop since early March. This occurs as the Federal Reserve holds interest rates steady, with hints that future policy might involve rate cuts, although this adjustment appears distant due to persistent high inflation figures.

The Nasdaq Composite rose by 1.5%, supported by gains in semiconductor stocks, following Apple’s impressive quarterly performance and the announcement of its buyback plan.

This comes amid a backdrop of robust U.S. economic data indicating a tight labor market, with expectations for the payrolls report ranging broadly from 150,000 to 280,000 new jobs.

Increases in commodity prices

Commodity prices also saw increases, with U.S. crude oil and Brent crude prices rising slightly. Spot gold prices, however, are on track for another weekly decline, reflecting the ongoing volatility and investor caution in global markets.

As market dynamics shift with interventions and economic updates, there’s significant potential for trading. Considering a Contract for Difference (CFD) account allows traders to speculate on these movements without owning the underlying assets, enhancing flexibility in both rising and falling markets.

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