Marketmind: Minutes come, minutes go

3 weeks ago 29

A look at the day ahead in European and global markets from Ankur Banerjee

The eagerly-anticipated Fed minutes arrived and failed to surprise, with markets broadly shrugging off the hawkish tone and still pining for a rate cut sometime this year.

Asian shares continue their bright start to the year with investors pinning their hopes on a swift rebound of the world's second-biggest economy after China dismantled much of its stringent COVID-related curbs. Now, how fast that recovery will be is something that remains to be seen, especially with rising infections taking a toll.

China's services activity shrank last month as surging COVID infections hit demand, a private-sector survey showed on Thursday, underscoring the challenges facing the country. While the road to recovery is likely to be a long and winding one, the optimism around the reopening has boosted sentiment, with business confidence at a 17-month high.

And so MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) is hovering at a four-month high and set for a fourth straight day of gains, while the U.S. dollar tries to find its footing after a volatile first four days of the year.

Market focus will switch to Friday's U.S. payrolls data but before that a clutch of European data could provide more clues as to where inflation is headed in Europe. French inflation, which unexpectedly dropped below 7%, added to the hope that the worst of the cost-of-living crisis in Europe is over.

Over in the corporate world, the tech industry's layoffs, which amounted to more than 150,000 workers in 2022, don't seem to end. Salesforce Inc (CRM.N) says it plans to eliminate about 10% of staff, while Amazon.com (AMZN.O) will cut more than 18,000 jobs.

Reuters Graphics

Key developments that could influence markets on Thursday:

Economic events: Eurozone producer prices for November, December S&P PMI data for Eurozone, Germany and France

Reporting by Ankur Banerjee; Editing by Jacqueline Wong

Our Standards: The Thomson Reuters Trust Principles.

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