Asian Markets Mostly Higher Amid Cautious Trades

Asian stock markets are trading mostly higher on Tuesday, following the broadly positive cues from the European markets overnight, as traders remain cautious ahead of key inflation readings from the U.S., Europe, Japan and Australia later in the week, which could help traders access the timing and pace of interest rate cuts this year. Asian markets closed mostly higher on Monday.

Extending the losses in the previous five sessions, the Australian stock market is modestly lower on Tuesday after opening well in the green, despite the broadly positive cues from global markets overnight. The benchmark S&P/ASX 200 is staying below the 7,800 level, with weakness in financial stocks partially offset by gains in mining and energy stocks amid firmer commodity prices.

The benchmark S&P/ASX 200 Index is losing 15.40 points or 0.20 percent to 7,772.90, after touching a high of 7,801.40 and a low of 7,769.20 earlier. The broader All Ordinaries Index is down 16.60 points or 0.21 percent to 8,042.00. Australian stocks closed significantly higher on Monday.

Among the major miners, Rio Tinto, Mineral Resources and BHP Group are edging up 0.2 to 0.5 percent each, while Fortescue Metals is flat.

Oil stocks are mostly higher. Beach energy is gaining more than 1 percent, while Woodside Energy and Santos are edging up 0.2 to 0.3 percent each. Origin Energy is edging down 0.1 percent.

Among tech stocks, Afterpay owner Block, WiseTech Global and Xero are edging down 0.2 to 0.3 percent each, while Zip is adding more than 1 percent and Appen is gaining almost 1 percent.

Gold miners are mostly higher. Gold Road Resources and Newmont are gaining almost 1 percent each, while Northern Star resources is adding more than 1 percent, Evolution Mining is advancing more than 2 percent and Resolute Mining is rising more than 3 percent.

Among the big four banks, Commonwealth Bank is edging down 0.2 percent and Westpac is losing almost 1 percent, while ANZ Banking and National Australia Bank are flat.

In other news, shares in Playside Studios are soaring more than 15 percent after the online gaming business lifted its guidance for EBITDA (operating income) for financial 2024.

Shares in Peter Warren Automotive are plunging 12 percent after the car dealership group issued a profit warning, saying margins are being squeezed by more competition in the sector as sales slow amid a household cost-of-living squeeze.

In the currency market, the Aussie dollar is trading at $0.667 on Tuesday.

Giving up some of the gains in the previous session, the Japanese stock market is modestly lower on Tuesday, with the Nikkei 225 falling below the 38,800 level, despite the broadly positive cues from European markets overnight, with losses index heavyweights and technology stocks.

The benchmark Nikkei 225 Index closed the morning session at 38,783.27, down 116.75 points or 0.30 percent, after hitting a low of 38,756.13 earlier. Japanese shares ended notably higher on Monday.

Market heavyweight SoftBank Group is edging up 0.2 percent and Uniqlo operator Fast Retailing is also edging up 0.2 percent. Among automakers, Honda is edging down 0.4 percent and Toyota is losing almost 1 percent.

In the tech space, Advantest is losing almost 1 percent, Tokyo Electron is declining more than 1 percent and Screen Holdings is slipping almost 3 percent.

In the banking sector, Sumitomo Mitsui Financial is gaining more than 1 percent and Mitsubishi UFJ Financial is adding almost 1 percent, while Mizuho Financial is losing almost 1 percent.

The major exporters are mixed. Panasonic is losing almost 2 percent and Sony is edging down 0.3 percent, while Mitsubishi Electric and Canon are gaining almost 1 percent each.

Among the other major losers, Sharp is losing almost 3 percent.

Conversely, Furukawa Electric is surging more than 7 percent and Kansai Electric Power is gaining more than 4 percent, while Sumitomo Electric Industries and Toray Industries are adding more than 3 percent each. Teijin, Nikon, Chubu Electric Power, Japan Steel Works and Tokyo Electric Power are advancing almost 3 percent each.

In the currency market, the U.S. dollar is trading in the higher 156 yen-range on Tuesday.

Elsewhere in Asia, China, South Korea, Singapore, Hong Kong, Indonesia and Taiwan are higher by between 0.1 and 0.3 percent each, while New Zealand and Malaysia are down 0.1 and 0.4 percent, respectively.

On Wall Street, the markets were closed for Memorial Day on Monday after closing higher on Friday.

The major European markets moved to the upside on the day. Germany’s DAX and France’s CAC 40 gained 0.44% and 0.46%, respectively. The U.K. market was closed due to Bank Holiday.

European Economic News Preview: Germany Wholesale Price Data Due

Wholesale price data from Germany is the only major report due on Tuesday, headlining a light day for the European economic news.

At 2.00 am ET, Destatis is scheduled to issue Germany’s wholesale prices for April. Economists forecast wholesale prices to rise 0.1 percent on month, in contrast to the 0.2 percent rise in March.

In the meantime, foreign trade from Sweden and retail sales and household consumption figures from Norway are due.

At 6.00 am ET, the Confederation of British Industry publishes monthly Distributive Trades survey results. The UK retail sales balance is expected to improve to -24 percent in May from -44 percent in April.

Australia Retail Sales Rise Less Than Expected

Australia’s retail sales grew less than expected in April as consumers reduced their discretionary spending, flash data from the Australian Bureau of Statistics showed on Tuesday.

Retail turnover edged up 0.1 percent on a monthly basis, reversing a 0.4 percent fall in March. But the pace of growth was weaker than economists’ forecast of 0.3 percent.

“Underlying retail spending continues to be weak with a small rise in turnover in April not enough to make up for a fall in March,” ABS head of retail statistics Ben Dorber said.

“Since the start of 2024, trend retail turnover has been flat as cautious consumers reduce their discretionary spending,” said Dorber.

The ABS is set to release detailed retail turnover data for April on June 4.

Data showed that turnover in most non-food related industries increased in April.
Other retailing, which gained 1.6 percent had the largest rise this month, followed by household goods retailing with 0.7 percent growth.

Meanwhile, clothing, footwear, and personal accessory retailing fell 0.7 percent.

“The relatively earlier Easter and the different timing of school holidays across the country meant we saw some added volatility in turnover in March and April,” Dorber added.

Food-related spending showed a mixed picture. Food retailing dropped 0.5 percent, while there was a small rise of 0.3 percent in cafes, restaurants and takeaway food services.

Retailers reported that spending on alcohol dropped off as consumers brought purchases forward into March and they increasingly opted for cheaper alcoholic products.

The consumption growth will probably remain weak into the second half of the year, which should help to lower inflation further, Capital Economics’ economist Marcel Thieliant said.

The Reserve Bank of Australia is expected to only start cutting interest rates at the beginning of next year, while the prolonged weakness in consumption opens the door for an earlier rate cut, the economist noted.

Crecelac And Farmalac Infant Formula Recalled

Prosper, Texas-based Dairy Manufacturers Inc. has recalled all lot codes for infant formulas available under Crecelac and Farmalac brands as they were sold in the U.S. without complying with the infant formula regulations of the U.S. Food and Drug Administration.

The recall involves Crecelac Infant 0-12 with UPC code 8 50042 40847 6, Farmalac 0-12 with UPC code 8 50042 40841 4; as well as Farmalac 0-12 Low lactose with UPC code 8 50042 40839 1 to the retail and wholesale level. All the impacted products, labeled as infant formula, come with expiry dates of 08/2025 or 09/2025.

They are packaged in a cardboard and aluminum can of 12.4 oz and sold only in the state of Texas at retail level.

The recall was initiated after the products have been found in non-compliance with the requirements of the FDA under section 21 CFR 106.110 New Infant formula registration. This was identified after an FDA notification, because the firm has not submitted the required premarket notification. No illnesses have been reported to date.

Consumers are urged to discontinue use of the recalled products and return it to the place of purchase for a full refund.

In similar recalls, Healthwest Minerals, Inc. d/b/a Mt. Capra Products in early May recalled 1,506 boxes of Goat Milk Formula Recipe Kit as it did not meet all FDA requirements for infant formula.

In mid-April, Newport Beach, California – based Sammy’s Milk warned parents against the use of its Goat Milk Toddler Formula as an infant formula, as it was specifically formulated for children between the ages of 12 and 36 months, and not for infants under 12 months of age.

For More Such Health News, visit rttnews.com

U.S. Stocks May Edge Higher As Trading Resumes Following Holiday Weekend

With traders returning to their desks following the long Memorial Day weekend, stocks may move to the upside in early trading on Tuesday.

After leading the markets higher last Friday, technology stocks may see further upside, with the Nasdaq 100 futures up by 0.3 percent.

Shares of Nvidia (NVDA) are surging by 3.0 percent in pre-market trading, as the AI darling seems poised to continue to benefit from last week’s upbeat earnings news.

Nvidia reported better than expected fiscal first quarter results and provided upbeat guidance while also announcing a ten-for-one stock split and increasing its quarterly cash dividend by 150 percent to $0.10 per share.

The S&P 500 futures are also inching up by 0.1 percent, although the Dow futures are edging down by 0.1 percent. The blue chip index may continue to underperform after pulling back sharply last week.

Overall trading activity may be somewhat subdued, however, as traders look ahead to the release of key inflation data later this week.

On Friday, the Commerce Department is due to release its report on personal income and spending in the month of April, which includes readings on inflation said to be preferred by the Federal Reserve.

The inflation data could have a significant impact on the outlook for interest rates ahead of the Fed’s next monetary policy meeting on June 11-12.

In an interview with CNBC this morning, Minneapolis Fed President Neel Kashkari said he needs to see “many more months of positive inflation data” before he would consider cutting interest rates.

Kashkari, who does not have a vote on the rate-setting Federal Open Market Committee this year, also said he could not rule out raising interest rates if inflation fails to slow.

Shortly after the start of trading, the Conference Board is scheduled to release its report on consumer confidence in the month of May. The consumer confidence index is expected to fall to 95.3 in May after slumping to 97.0 in April.

Following the downturn seen over the course of last Thursday’s session, stocks showed a strong move back to the upside during trading on Friday. The tech-heavy Nasdaq led the rebound, surging to a new record closing high.

The Nasdaq jumped 184.76 points or 1.1 percent to 16,920.94 and the S&P 500 climbed 36.88 points or 0.7 percent to 5,304.72, while the narrower Dow ended the day roughly flat, inching up just 4.33 points or less than a tenth of a percent to 39,069.59.

While the Nasdaq shot up by 1.4 percent for the week, the S&P 500 was nearly unchanged and the Dow tumbled by 2.3 percent.

In overseas trading, stock markets across the Asia-Pacific region moved modestly lower during trading on Tuesday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while China’s Shanghai Composite Index fell by 0.5 percent.

The major European markets have also moved to the downside on the day. While the French CAC 40 Index has slid by 0.7 percent, the U.K.’s FTSE 100 Index is down by 0.3 percent and the German DAX Index is down by 0.1 percent.

In commodities trading, crude oil futures are surging $1.32 to $79.04 a barrel after climbing $0.85 to $77.72 a barrel last Friday. Meanwhile, after edging down $2.70 to $2,334.50 an ounce in the previous session, gold futures are advancing $19.70 to $2,354.20 an ounce.

On the currency front, the U.S. dollar is trading at 156.67 yen versus the 156.86 yen it fetched on Monday. Against the euro, the dollar is trading at $1.0874 compared to yesterday’s $1.0858.

Dollar Firmed Up Last Week Amidst Hawkish Fed Minutes

The uncertain monetary policy outlook triggered by the mixed comments in the FOMC Minutes helped the U.S. dollar remain firm during the week spanning May 20 to 24. During the week, the U.S. dollar gained against the euro, the Australian dollar and the Japanese yen but weakened against the British pound. The 6-currency Dollar Index also increased during the past week.

The U.S. dollar’s strength against a basket of six currencies comprising the euro, the British pound, the Japanese yen, the Canadian dollar, the Swedish kroner and the Swiss franc, as measured by the Dollar Index recorded an uptick of 0.27 percent during the week ended May 24. The DXY closed at 104.72 on May 24, rising from 104.44 a week earlier.

The Fed Minutes released on Wednesday contained concerns about whether the monetary policy was sufficiently restrictive and whether further tightening was warranted. Though FOMC participants assessed that monetary policy was well-positioned, comments by Fed officials during the week added to concerns about Fed keeping interest rates at the current high level for some more time. Amidst the anxiety, the index oscillated between the low of 104.39 recorded on Monday and the high of 105.12 touched on Friday.

The euro slipped 0.23 percent against the U.S. dollar during the week ended May 24 amidst dovish comments from ECB officials. From the level of 1.0870 on May 17, the EUR/USD pair dropped to 1.0845 on May 24. The pair which had touched a weekly high of 1.0885 on Monday recorded the weekly low of 1.0805 on Friday.

The greenback however retreated against the sterling during the week ended May 24. The GBP/USD pair added 0.32 percent, rising to 1.2740 from 1.2699 a week earlier amidst a lesser-than-expected decline in inflation. Headline inflation in April declined to 2.3 percent from 3.2 percent in March whereas markets had expected it to fall to 2.1 percent. The weekly trading range was between the high of 1.2763 recorded on Wednesday and the low of 1.2678 on Friday.

The Australian dollar slipped close to a percent against the U.S. dollar in the last week despite minutes of the Reserve Bank of Australia revealing it deliberated on increasing interest rates. The AUD/USD pair which was at 0.6692 on May 17, plunged to 0.6627 on May 24, implying weekly losses of 0.97 percent. The pair which had touched a weekly high of 0.6711 on Monday recorded the weekly low of 0.6591 on Friday.

The U.S. dollar gained 0.86 percent against the Japanese yen during the week ended May 24, lifting the USD/JPY pair to 156.99, from 155.65 a week earlier. A more-than-expected decline in consumer price inflation triggered concerns about the headroom available to the Bank of Japan to raise interest rates. Amidst the concerns, the USD/JPY pair traded between the low of 155.49 recorded on Monday and the high of 157.20 recorded on Thursday.

Major economic data releases over the ensuing week are bound to sway the currency market sentiment. On the horizon are consumer confidence readings from Japan and Germany, inflation updates from Australia, Germany, France and Euro Area, PMI updates from China as well as GDP readings from U.S. and Canada. Nevertheless, the market spotlight would be on PCE-based inflation readings due from the U.S. on Friday.

Amidst the anticipation, the DXY has declined to 104.39. The EUR/USD pair has increased to 1.0879 whereas the GBP/USD pair has firmed up to 1.2798. The AUD/USD pair has increased to 0.6677. Meanwhile, the yen has gained, dragging the USD/JPY pair to 156.62.

Asian Markets Trade Mostly Higher

Asian stock markets are trading mostly higher on Monday, following the broadly positive cues from Wall Street on Friday, and as some traders indulged in picking up stocks for a bargain following the recent sell-off in the markets. They also remain cautious amid the lingering concerns about the outlook for interest rates. Asian markets closed mostly lower on Friday.

The Australian stock market is currently trading significantly higher on Monday, recouping some of the losses in the previous four sessions, with the benchmark S&P/ASX 200 moving to near the 7,800.00 level, following the broadly positive cues from Wall Street on Friday, with gains across most sectors led by gold miners, technology and financial stocks.

The benchmark S&P/ASX 200 Index is gaining 57.00 points or 0.74 percent to 7,784.60, after touching a high of 7,790.30 earlier. The broader All Ordinaries Index is up 54.90 points or 0.67 percent to 8,054.10. Australian stocks closed sharply lower on Friday.

Among the major miners, Rio Tinto, Mineral Resources and Fortescue Metals are edging down 0.1 to 0.5 percent each, while BHP Group is edging up 0.5 percent.

Oil stocks are mostly higher. Beach energy and Origin Energy are gaining almost 1 percent each, while Santos is edging up 0.5 percent. Woodside Energy is edging down 0.4 percent.

Among tech stocks, Xero and Appen are gaining almost 1 percent each, while Afterpay owner Block and WiseTech Global ares edging up 0.1 to 0.2 percent each. Zip is advancing more than 3 percent.

Gold miners are higher. Resolute Mining and Newmont are up almost 1 percent each, while Northern Star Resources and Evolution Mining are adding almost 2 percent each. Gold Road Resources is gaining more than 2 percent.

Among the big four banks, Commonwealth Bank is gaining more than 1 percent, while ANZ Banking, Westpac and National Australia Bank are adding almost 1 percent each.

In other news, shares in Lendlease are surging almost 9 percent after it unveiled sweeping changes to its global strategy.

Shares in Vista Group are soaring 19 percent after private capital firm Potentia Group acquired an 18.5 percent stake in the film software company.

In the currency market, the Aussie dollar is trading at $0.663 on Monday.

The Japanese stock market is trading modestly higher on Monday, reversing the losses in the previous session. The benchmark S&P/ASX 200 is moving well above the 38,700 level, following the broadly positive cues from Wall Street cues on Friday, with gains in index heavyweights and technology stocks.

The benchmark Nikkei 225 Index closed the morning session at 38,758.96, up 112.85 or 0.29 percent, after touching a high of 38,802.74 earlier. Japanese shares ended sharply lower on Friday.

Market heavyweight SoftBank Group is gaining almost 1 percent and Uniqlo operator Fast Retailing is edging up 0.3 percent. Among automakers, Honda is edging up 0.3 percent and Toyota is gaining almost 1 percent.

In the tech space, Screen Holdings is advancing more than 3 percent and Advantest is gaining more than 1 percent, while Tokyo Electron is edging down 0.3 percent.

In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are edging up 0.1 to 0.3 percent each, while Mizuho Financial is edging down 0.1 percent.

The major exporters are mixed. Canon and Panasonic are gaining almost 1 percent each, while Mitsubishi Electric is losing almost 1 percent and Sony is declining more than 1 percent.

Among other major gainers, Kansai Electric Power is surging more than 5 percent, while Kawasaki Kisen Kaisha, Renesas Electronics and Kawasaki Heavy Industries are gaining more than 4 percent each. Japan Steel Works is adding almost 4 percent, while Nippon Yusen K.K., Furukawa Electric, Mitsubishi Heavy Industries and Mitsui O.S.K. Lines are up more than 3 percent each. Fujikura and Fuji Electric are advancing almost 3 percent each.

Conversely, NEXON is losing almost 5 percent, CyberAgent is sliding almost 4 percent, LY is declining more than 3 percent and Hoya is down almost 3 percent.

In the currency market, the U.S. dollar is trading in the higher 156 yen-range on Monday.

Elsewhere in Asia, Taiwan is up 1.4 percent, while China, Singapore, Malaysia and South Korea are higher by between 0.1 and 0.7 percent each. New Zealand, Hong Kong and Indonesia are down 0.2 percent each.

On Wall Street, stocks showed a strong move back to the upside during trading on Friday following the downturn seen over the course of the previous session. The tech-heavy Nasdaq led the rebound, surging to a new record closing high.

The Nasdaq jumped 184.76 points or 1.1 percent to 16,920.94 and the S&P 500 climbed 36.88 points or 0.7 percent to 5,304.72, while the narrower Dow ended the day roughly flat, inching up just 4.33 points or less than a tenth of a percent to 39,069.59.

Meanwhile, the major European markets also moved to the downside on the day. The U.K.’s FTSE 100 Index dipped by 0.3 percent and the French CAC 40 Index edged down by 0.1 percent, although the German DAX Index closed just above the unchanged line.

Crude oil prices moved higher Friday, snapping a four-day losing streak despite concerns about the outlook for demand. West Texas Intermediate crude oil futures for July ended higher by $0.85 at $77.72 a barrel; for the week, WTI crude futures slumped 3 percent.

European Economic News Preview: Germany Business Sentiment Data Due

Business confidence data from Germany is the only major report due on Monday, headlining a light day for the European economic news.

At 4.00 am ET, Germany’s ifo business confidence survey data is due. The business confidence index is forecast to rise to 90.3 in May from 89.4 in the previous month.

In the meantime, unemployment data is due from Poland. The jobless rate is seen at 5.1 percent in April, down from 5.3 percent in March.

At 5.00 am ET, producer price data is due from Iceland.

German Ifo Business Sentiment Steadies In May

German business confidence stagnated in May as the deterioration in the current assessment was offset by the improvement in expectations, survey results from the ifo Institute showed on Monday.

The business climate index registered 89.3 in May, unchanged from April. The score was forecast to improve to 90.3 from April’s initially estimated value of 89.4.

The indicator steadied in May after three straight months of increase.

Companies were less satisfied with their current situation, while their expectations brightened.

The current situation index unexpectedly dropped to 88.3 from 88.9 in the previous month. The reading was seen at 89.9.

Meanwhile, the ifo expectations indicator advanced to a 13-month high of 90.4 from 89.7 a month ago.

ifo President Clemens Fuest said, “Germany’s economy is working its way out of the crisis step by step.”

The ifo survey showed that the manufacturing, trade and construction sectors recovered in May, while the service sector weakened.

In manufacturing, the business confidence strengthened for the third month. Companies were more satisfied with their current situation and their outlook for the coming months was less pessimistic.

In the service sector, the business confidence deteriorated in May. Current business situation worsened, while their expectations improved a bit. Companies reported additional orders.

In trade, the business climate index advanced notably. Although business expectations rose considerably, they were still marked by skepticism. The current situation also rose in May.

In construction, the business climate index climbed again. Companies were more satisfied with their current situation and their expectations were somewhat less pessimistic.

German Ifo Business Sentiment Steadies In May

German business confidence stagnated in May as the deterioration in the current assessment was offset by the improvement in expectations, survey results from the ifo Institute showed on Monday.

The business climate index registered 89.3 in May, unchanged from April. The score was forecast to improve to 90.3 from April’s initially estimated value of 89.4.

The indicator steadied in May after three straight months of increase.

Companies were less satisfied with their current situation, while their expectations brightened.

The current situation index unexpectedly dropped to 88.3 from 88.9 in the previous month. The reading was seen at 89.9.

Meanwhile, the ifo expectations indicator advanced to a 13-month high of 90.4 from 89.7 a month ago.

ifo President Clemens Fuest said, “Germany’s economy is working its way out of the crisis step by step.”

The ifo survey showed that the manufacturing, trade and construction sectors recovered in May, while the service sector weakened.

In manufacturing, the business confidence strengthened for the third month. Companies were more satisfied with their current situation and their outlook for the coming months was less pessimistic.

In the service sector, the business confidence deteriorated in May. Current business situation worsened, while their expectations improved a bit. Companies reported additional orders.

In trade, the business climate index advanced notably. Although business expectations rose considerably, they were still marked by skepticism. The current situation also rose in May.

In construction, the business climate index climbed again. Companies were more satisfied with their current situation and their expectations were somewhat less pessimistic.