In the US, both the macroeconomic data flow and the statements of the Fed officials make it difficult for asset prices to find direction.
The New York Fed manufacturing index announced yesterday was above expectations with 10.8 in April, reaching its highest value since July 2022.
Richmond Fed chairman Thomas Barkin said he would like to see more evidence of inflation in the US returning to the Fed’s 2 percent target. Barkin stated that the country’s economy is functioning well at the current level of interest rates.
While these developments continue to support the expectations that the Fed will raise the policy rate by 25 basis points at the meeting to be held next month, the probability in question is priced at 87 percent in the money markets.
On the other hand, the prospects for a 25 basis point rate hike in the July meeting, albeit with a low probability, are gaining strength day by day, raising question marks for investors.
While these developments led to the selling pressure in the bond markets, the US 2-year bond yield tested the highest level since March 22 with 4.21 percent yesterday.
Analysts noted that the continuation of the signs of strong economic activity in the country made the expectations about the Fed’s roadmap again uncertain, and stated that the housing market data, which will be released today in the USA, may have an impact on asset prices.
Reminding that the housing market, which is one of the markets where hawkish steps are usually first affected, continues to remain strong despite the steps taken by the Fed, analysts stated that this situation narrows the policy area of the Fed, which wants to make a “soft landing” in the country’s economy.
Analysts, however, stated that the profitability of the banks in the announced balance sheets kept the risk appetite alive, and said that the financial results of Johnson & Johnson, Goldman Sachs, Netflix and Bank of America, which will be announced today, are expected to increase the volatility in the markets.
While the dollar index, which rose 0.5 percent yesterday, was stabilized at 102.1 in the new day, the ounce price of gold, which is currently at $ 2,000, tested the lowest level since April 4 with $ 1,981 after increasing selling pressure yesterday.
With these developments, the S&P 500 index rose by 0.33 percent, the Dow Jones index by 0.30 percent and the Nasdaq index by 0.28 percent in the New York stock market yesterday. Index futures contracts in the USA started the new day with a limited decline.
While the European stock markets ended the upward trend for 5 days in a row yesterday, the change in pricing for the steps to be taken by the European Central Bank (ECB) next month draws attention.
While the Bank’s 25 basis points interest rate hike on May 4 is considered certain, the 50 basis point rate hike expectations to 35 percent have caused concerns in the markets.
It is seen that the selling pressure in the bond markets in the region has moved to the fifth business day, while the pricing that the ECB will increase interest rates by 75 basis points in total has not changed yet, limiting the risk perception.
With these developments, DAX 40 index decreased by 0.11 percent in Germany, CAC 40 index decreased by 0.28 percent in France and MIB 30 index decreased by 0.62 in Italy, while FTSE 100 index increased by 0.10 percent in England. Index futures contracts in Europe started the new day with rising.
In the Asian stock markets, a fluctuating course stands out with the data released in China today.
Accordingly, although the Gross Domestic Product (GDP) in China grew by 4.5 percent in the first quarter, surpassing expectations, the sub-items of the data increased the concerns about the country’s economy.
In the first three months of the year, industrial production increased by 3 percent, falling short of expectations, while retail sales rose by 10.6 percent, far surpassing the projections.
Analysts noted that the industrial production in the country did not reach the expected level and that increased expenditures could support imports, and stated that this situation poses a danger to the Chinese economy.
Stating that the effects of the epidemic continued to be seen on industrial production despite the removal of the measures against the Covid-19 epidemic, analysts said that the recovery in the country was closely followed in the markets.
While the Nikkei 225 index in Japan increased by 0.4 percent and the Shanghai composite index in China increased by 0.1 percent, the Kospi index in South Korea decreased by 0.3 percent and the Hang Seng index in Hong Kong decreased by 0.6 percent.
BIST 100 index in Borsa Istanbul, which followed a sales-weighted course in the domestic market yesterday, finished the day at 5,059.35 points, 0.66 percent below the previous closing.
Dollar/TL is trading at 19.3990 at the opening of the interbank market today, after closing at 19.3911 with an increase of 0.1 percent yesterday.
Analysts stated that today, the housing price index in the country, the ZEW expectations index in Germany and the Eurozone abroad, and the housing starts and construction permits data in the USA will be followed. He noted that he was in a resistance position.