US stocks erase losses amid US China de-escalation hopes and earnings. Gold holds firm, Yen gains, Dollar weakens, and Oil retreats on demand worries.
Conflicting movements in global markets
The US stock market managed to erase intraday losses on Monday, 28 April, in anticipation of a potential US-China de-escalation, and rosy earnings beat from mega-cap Apple, Amazon, Microsoft, and Meta Platforms results out later this week.
Major US stock indices reversed from their 1% intraday losses, with both the S&P 500 and Nasdaq 100 ending yesterday's session almost unchanged. The Dow Jones Industrial Average and the Russell 2000 added marginal gains of 0.3% and 0.4%, respectively.
In contrast, yesterday’s price actions of Gold (XAU/USD) did not reflect the optimism of a thaw in US-China tensions, as it rebounded after a retest on last Friday’s low of $3,265 and ended with a gain of 0.7%.
In case you missed: Chart of the week – USD/JPY medium-term downtrend remains intact as BoJ looms
US Treasury Secretary Bessent mentioned in a media interview yesterday that the US government is in contact with China, but Beijing needs to take the initiative in de-escalating the trade tensions. In addition, the US has excluded China for now in the ongoing process of trade deal negotiations with 15 to 17 other countries.
The US dollar continued to limp along with the uncertainties surrounding the current US-China trade standoff. The sterling rallied by 1% yesterday as the GBP/USD hit a three-year high at 1.3444. The safe haven Japanese yen was the biggest G10 FX gainer, rising by 1.2% to 141.98 yen per US dollar.
West Texas crude oil staged a retreat again below its 20-day moving average, which is acting as a key near-term resistance at $63.80/barrel, where it shed 2.1% over external demand woes.
