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Asian markets are poised for a positive start, with major indices like the Nikkei and ASX showing gains. The Singapore Blue Chip index is nearing its November 2021 high, having surged nearly 33% since August, while Japan's CPI data supports potential rate hikes by the Bank of Japan.
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The U.S. dollar remains near a 13-month high as investors evaluate the Federal Reserve's interest rate trajectory, with the euro struggling amid European uncertainties. The dollar index slightly dipped to 107.01, close to its one-year peak, while U.S. jobless claims fell to a seven-month low, suggesting potential for rate cuts in December.
Japan's Prime Minister Shigeru Ishiba announced that the forthcoming stimulus package is expected to have an overall impact of ¥39 trillion ($250 billion), which includes private sector spending. He emphasized the urgent need to raise wages across all generations, highlighting its importance for the present and future.
Alain Bouchard, founder and chairman of Alimentation Couche-Tard Inc., has ruled out a hostile takeover of Seven & i Holdings Co. while maintaining his ¥7.3 trillion ($47.3 billion) buyout proposal. This follows a competing ¥9 trillion management buyout offer from the Ito family, backed by banks and Itochu Corp.
Japan's core inflation in October remained above the central bank's 2% target, with a key index excluding fuel costs showing an acceleration. This persistent inflation is increasing pressure on the central bank to consider raising its currently low interest rates.
Asia-Pacific markets surged as investors reacted to Japan's October inflation data, with core CPI rising 2.3%, slightly above expectations. Japan's Nikkei 225 and Topix gained 0.54% and 0.51%, respectively, while Australia's S&P/ASX 200 increased by 0.71%. In the U.S., major indexes also rose, with the Dow Jones up 462 points, as crude oil prices climbed following geopolitical tensions.
The yen's strength has led to declines in GBP/JPY and EUR/JPY, with GBP/JPY unable to maintain recent gains and testing support at ¥194.00. EUR/JPY has also dropped, with potential targets at ¥162.00 and ¥158.00. Meanwhile, EUR/GBP continues to fall, aiming for £0.83 and the November low at £0.8260, reflecting a persistent bearish trend.
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EUR/USD remains under bearish pressure, trading below 1.0550 amid mixed US economic data, while GBP/USD stabilizes near 1.2650 despite ongoing geopolitical tensions. Norinchukin Bank in Japan anticipates significant losses due to rising global interest rates, prompting asset disposals to mitigate risks. The dollar index holds steady, with gold prices rising significantly.
Global indices, including the FTSE 100, S&P 500, and Nikkei 225, are facing early pressure following Nvidia's recent earnings report, contributing to a cautious market sentiment. The FTSE 100 has fluctuated around 8100, with resistance noted below 8200 and support at 8300. The S&P 500 shows indecision, maintaining a short-term low near 5850, while the Nikkei 225 has dropped, with critical support at 37,700.
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Bank of Japan Governor Kazuo Ueda indicated that the upcoming monetary policy meeting in December will feature a live discussion on the possibility of raising interest rates. He emphasized the unpredictability of the meeting's outcome, noting that significant data will emerge in the month leading up to it.
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