ISTANBUL
Global markets followed a mixed course on Tuesday amid uncertainties over the Fed’s future policies and increasing geopolitical tensions, while all eyes turn to chipmaker Nvidia’s balance sheets to be announced.
The risk appetite in the global markets fell as Russia-Ukraine tensions escalated, giving increase to European stock markets.
Ukraine reported that it attacked the Bryansk region in Russia with US-made long-range missiles (ATACMS) at night and Russian President Vladimir Putin approved the nuclear doctrine, which allows the country to respond with nuclear weapons in the face of ballistic missile attacks.
As a result, the demand for safe-haven assets rose, as gold climbed 1% per ounce on Tuesday, while bond markets followed a buying-heavy course, with the US 10-Year Futures bond falling to as low as 4.34% and ending the day at 4.39%.
Estimates were made difficult by concerns over the potential resumption of trade wars due to President-elect Donald Trump’s tax cuts for corporations and high tariffs on imported goods in the US.
Inflation moving towards 2% target
Meanwhile, Fed officials stated that the bank’s rate cuts show confidence that inflation is moving towards the 2% target.
The Fed is estimated to cut its interest rates in December with a 59% probability and leave its rates unchanged with a 41% probability in the money markets.
Analysts stated that Nvidia’s balance sheets to be announced on Wednesday will be effective in the direction of the markets, as its market cap of over $3 trillion makes it one of the biggest players in the chipmaking business, and its performance can give insight into the course of the US economy.
As for commodities, copper rose per pound on Monday and Tuesday after seeing its lowest level since August last week, while Brent crude oil started Tuesday at $72.9 per pound, down 0.3% after a two-day rise.
The upward trend seen in the cryptocurrency markets after Trump’s win continued, as Bitcoin broke a record at $93,905, while currently trading at around $92,500 on Tuesday.
The S&P 500 rose 0.4% and the Nasdaq 1.04%, while the Dow Jones fell 0.3% on the New York Stock Exchange on Tuesday. American index futures started Wednesday on a positive course.
European stock markets on sales-heavy course
Meanwhile in Europe, stock markets followed a sales-heavy course with increased tensions in Ukraine and Russia.
The eurozone Consumer Price Index (CPI) rose from 1.7% to 2% on an annual basis in October.
The European Central Bank (ECB) is certain to cut its rates by 25 basis points at its December meeting, though the data to be announced until that time is expected to influence the degree of easing.
The FTSE 100 fell 0.1%, the CAC 40 and the DAX 40 both decreased 0.7%, and the FTSE MIB 30 declined 1.3% on Tuesday, while European index futures started Wednesday on a mixed course.
Asian markets follow mixed course
As for Asia, markets followed a mixed course on Wednesday while Nvidia’s balance sheets may have some company-based effects in the region.
The People’s Bank of China (PBoC) left its 1-year and 5-year Loan Prime Rates (LPR) unchanged at 3.10% and 3.60%.
However, concerns over economic activity in China remain, as Trump picked Cantor Fitzgerald CEO Howard Lutnick as secretary of commerce, who would lead the tariff and trade agenda of the second Trump administration, and the possible consequences of that on the region will be closely monitored.
Meanwhile, Japanese yen continued to depreciate as the US dollar/Japanese yen parity rose above the 155 level again on Wednesday, while the country’s foreign trade balance in October saw a 461.2 billion yen ($2.9 billion) deficit, and Japan’s imports climbed 0.4% and exports 3.1%.
The Nikkei 225 fell 0.2% and the Hang Seng index 0.1%, while the Kospi index rose 0.4% and the Shanghai Composite Index increased 0.3%.
As for Türkiye, the BIST 100 declined 1.73% on Tuesday and ended the day at 9,232.90 points.
The US dollar/Turkish lira exchange rate closed Tuesday at 34.48500 with a 0.2% decline and it is now trading at 34.4920 on Wednesday on a horizontal course.
*Writing by Emir Yildirim
