Financial Markets Daily Report05 February 2024
In the last session of the week, investors traded with a risk-on mood as their economic optimism outweighed concerns of a tighter monetary policy stance by the US Federal Reserve. The release of January employment report in the US showed that its labor market remains tight, with 353k more payrolls and the unemployment rate still at 3.7%.
- In the last session of the week, investors traded with a risk-on mood as their economic optimism outweighed concerns of a tighter monetary policy stance by the US Federal Reserve. The release of January employment report in the US showed that its labor market remains tight, with 353k more payrolls and the unemployment rate still at 3.7%.
- This better-than-expected economic release reduced the implied probabilities of an interest rate cut by the Fed in its March and May meetings from 37% and 100% to 18% and 75%, respectively. Hence, sovereign yields rose markedly on both sides of the Atlantic, with the 10-year Treasury trading above 4%.
- Elsewhere, stock indices edged up, the US dollar strengthened against most of its peers and the price of the barrel of Brent declined and traded below $80 per barrel.
- This week the focus will be on January’s final PMIs and on the US services ISM.