Opening Bell: Global Stocks Jump On China Pro-Business Assurance; Oil Recovers

Key Events

Global markets, as well as futures on the Dow Jones, S&P 500, NASDAQ, and Russell 2000 jumped in trading on Wednesday after China's government tried to ease anxiety about additional regulations on the country's technology sector as well as concerns about the beleaguered Chinese property sector. Official comments helped improve trader sentiment which has been seriously dented by war and high inflation worries.

Treasuries sold off ahead of today's Federal Reserve interest rate decision.

Global Financial Affairs

Chinese policymakers promised to support the market and boost economic growth in response to the recent stock selloff there, particularly in property and technology shares. Chinese and Hong Kong shares lost about $1.5 trillion in value over the last two days. Part of the pessimism was due to concerns that China's relationship with Russia will see the Asian nation being subjected to sanctions as well as an exodus of business and capital.

This morning the Hang Seng jumped over 9%, the most since 2020. Firms listed on the Hong Kong exchange registered the most significant gain since the global financial crisis; conversely, the Hang Seng TECH index dropped, losing 11% at time of writing.

Europe's STOXX 600 soared 1.8% at the open, thanks to a jump in the travel & leisure, consumer products, and financial sectors.

All four US index futures were green on Wednesday, with NASDAQ futures outperforming its peers.

US stocks rebounded on Tuesday at the same time as oil prices extended their selloff notwithstanding that the Producer Price Index came in flat for February YoY, thereby surprising to the downside. All of which eased expectations that the Fed will be aggressive in its tightening, which would slow or even end economic growth.

Treasury yields on the 10-year note eased slightly.

The US dollar declined for the third consecutive day, in a crowded trade which is the telltale sign of a continuation pattern.

The greenback has been developing a potential pennant, bullish after the price completed an H&S continuation pattern.

Gold slid for the fourth day, losing the safe-haven asset competition to US Treasuries.

Technically, the yellow metal was performing a return move after breaking out of a substantial symmetrical triangle, whose implied objective was nonetheless already met.

Bitcoin rallied but then gave up some of its advance.

Oil found support after a two-day selloff.

Technically, the price may be performing a return move after an H&S top on the 4-hour chart.

Up Ahead

• On Thursday, the Bank of England announces its rate decision.
• Europe publishes CPI figures on Thursday.
• The Philadelphia Fed Manufacturing index is published on Thursday.

Market Moves

Stocks

• The STOXX 600 rose 1.8%
• Futures on the S&P 500 climbed 0.8%
• Futures on the NASDAQ 100 advanced 1.3%
• Futures on the Dow Jones Industrial Average rose 0.7%
• The MSCI Asia Pacific Index jumped 3.3%
• The MSCI Emerging Markets Index rose 4%

Currencies

• The Dollar Index fell 0.1%
• The euro rose 0.365 at $1.0986
• The Japanese yen was little changed at 118.35 per dollar
• The offshore yuan rose 0.2% to 6.3699 per dollar
• The British pound rose 0.2% to $1.3061

Bonds

• The yield on 10-year Treasuries eased to 2.16%
• Germany's 10-year yield rose to 0.3685%
• Britain's 10-year yield increased two basis points to 1.60%

Commodities

• Brent crude rose 0.9% to $100.83 a barrel
• Spot gold rose 0.2% to $1,921.12 an ounce