After Fed Minutes, Dollar Slumps to 1 1/2-Year Low Versus Yen

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The dollar touched the weakest level since October 2014 against the yen after the release of minutes from the Federal Reserve’s March meeting, when policy makers scaled back expectations for the pace of interest-rate increases in 2016.

The minutes shed more light on officials’ decision to keep rates unchanged last month, after hiking from near zero in December. The account showed policy makers debated an April rate hike, though several officials advocated a cautious approach, partly amid worries that slowing world growth could crimp the U.S. economy expansion.

The U.S. currency plunged March 16 after Fed Chair Yellen said the dollar’s two-year appreciation has weighed on inflation. The central bank also released projections implying two quarter-point rate increases this year, down from four forecast in December. The meeting dimmed the appeal of bets that U.S. monetary policy would diverge from the stimulus efforts of the Bank of Japan and the European Central Bank.

The dollar fell 0.5 percent to 109.79 yen as of 5 p.m. in New York, after touching 109.34. The greenback dropped 0.1 percent to about $1.14 per euro, approaching the weakest since October.

Source: Bloomberg

Oil Ends Sharply Higher After Unexpected U.S. Inventory Drop

The U.S. oil benchmark scored its biggest one-day jump in three weeks Wednesday after weekly government data showed a large and unexpected fall in U.S. crude inventories and an increase in demand by refineries.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in May advanced $1.86, or 5.2%, to close at $37.75 a barrel. The jump was the biggest since March 16. June Brent crude on London’s ICE Futures exchange rose $1.97, or 5.2%, to finish at $39.84 a barrel.

The Energy Information Administration said oil inventories fell by 4.9 million barrels in the week ended April 1. Analysts surveyed by oil data firm Platts had forecast an inventory rise of 2.9 million barrels. Oil futures, however, had already found support after closely watched data from the American Petroleum Institute, an industry trade group, late Tuesday reportedly showed a 4.1 million barrel drop.

The decline was the biggest for this week of the year since at least 1997, according to Bespoke Investment Group. In addition, the data showed U.S. refineries used over 16.4 million barrels a day on average, up 199,000 barrels from a week earlier. Refiners operated at 91.4% of operable capacity last week, the data showed.

Source: MarketWatch

Hong Kong Share Index Little Changed as Financials Curb Gains (Riview)

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Hong Kong stocks were little changed on Wednesday, with financial shares curbing gains on the main index as investors await fresh cues for direction.

The Hang Seng index rose 0.2 percent, to 20,206.67, while the China Enterprises Index lost 0.1 percent, to 8,668.63 points.

Most sectors rose but financial shares underperformed, losing 0.5 percent, as Chinese banks are under margin pressures from a slowing economy and rising bad debt.

Chi Lo, economist at BNP Paribas Investment Partners pointed out that some market players believe that China would see a banking crisis soon, with losses expected to amount to $3.5 trillion. But such an "Armageddon" scenario was not a fair bet on China, he wrote.

Source : Reuters

U.S. Stocks Rally as Health-Care, Energy Shares Lead a Rebound

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U.S. stocks advanced, with the Standard & Poor’s 500 Index posting its best gain in more than three weeks, as health-care shares rallied on deal speculation and energy producers rallied with crude oil.

The main benchmark index halted a two-day slide as Pfizer Inc.’s busted deal with Allergan Plc sparked speculation the two companies will now turn their attention to other potential merger targets, sending biotechnology companies to their strongest rally in more than four years. An unexpected drop in crude stockpiles drove crude and energy producers to their biggest gains in three weeks.

The S&P 500 rose 1.1 percent to 2,066.71 at 4 p.m. in New York, recovering from the biggest two-day drop since Feb. 9 as gains accelerated in the final hour. After the longest span without a 1 percent move in more than a year, the index has posted two such swings back to back.

Equities held gains after minutes from the Federal Reserve’s last meeting showed policy makers were worried that slowing world growth could reduce corporate investment plans and restrain U.S. exports.

Following Fed Chair Janet Yellen’s reiteration that future rate increases will be gradual and the latest meeting minutes, traders are pricing in no possibility of an April hike. December is now the first month with at least even odds of a boost in borrowing costs.

Source: Bloomberg

U.S. Stocks Advance Before Fed Minutes Following Two-Day Slide

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U.S. stocks advanced, after the Standard & Poor’s 500 Index rebounding from the steepest decline in almost a month, boosted by rallies in health-care and energy shares while investors awaited minutes from the Federal Reserve’s latest meeting.

The benchmark index was on the way to halting a two-day slide that followed a 2016 high, amid a lull in economic data and before corporate earnings season gears up to provide evidence on the sturdiness of U.S. growth. Health-care companies were on track for the strongest increase in more than a month as drug companies surged.

The S&P 500 rose 0.7 percent to 2,058.48 at 11:55 a.m. in New York, after sliding yesterday to cap the biggest two-day drop since Feb. 9. The Dow Jones Industrial Average climbed 85.33 points, or 0.5 percent, to 17,688.65. The Nasdaq Composite Index advanced 1 percent, lifted by gains among biotechnology companies. Trading volume in S&P 500 shares was in line with the 30-day average for this time of day.

The S&P 500 fell 1 percent yesterday, leaving it little changed for the year amid concern global growth will remain sluggish. The gauge’s rebound from a nearly two-year low in February has shown signs of waning in tepid trading volume as investors consider whether efforts by central banks are potent enough to fend off slowing growth. Minutes from the Fed’s March meeting are due at 2 p.m.

Source: Bloomberg