©Reuters. What are the most important developments in risk appetite in the markets today?
Arabictrader.com – Risk appetite fell slightly during trading on Tuesday, coinciding with uncertainty over the Russian cap mechanism adopted yesterday, followed by developments in risk appetite on major assets traded in the markets:
First: risk appetite and equity markets:
Risk appetite varied across global equity markets, as European equities fell collectively, while Chinese equities rose as did Japanese equities, following the announcement of the easing of epidemic restrictions and the mixed performance of futures US stock indexes.
Second: risk appetite and the US dollar:
The US dollar continued to fall, having managed to erase some of its losses earlier in the session, but then pulled back again, with investors waiting for more signals on the US Federal Reserve’s moves at its next meeting.
Labor market data released on Friday showed the economy added more jobs than market expectations, but the revised reading of the previous month’s data showed a decline in the current reading, meaning the labor market work has clearly been affected by previous interest increases.
At the same time, data released yesterday showed that the US manufacturing sector grew more than expected, reflecting the resilience of the US economy and the lack of sufficient impact on economic activity by the Fed’s decisions, which bolstered investor expectations that the U.S. Federal Reserve could continue to raise interest rates at a sustained pace.
Divergence in expectations pushed the dollar through a slightly volatile profit-loss session but is now down.
In addition, US dollar losses also increased due to lower yields today.
Third: Appetite for Risk and Gold:
Gold rallied in today’s trading, benefiting from the decline in the US dollar and US Treasury yields, erasing some of yesterday’s losses supported by the release of PMI data for the manufacturing sector.
Fourth: Appetite for risk and oil:
Oil futures fell during today’s trading after Russia announced that demand for its oil was unaffected by yesterday’s price cap decision.
Oil also benefited from the declining US dollar, which reduced its cost to investors holding other currencies, which stimulated demand for it.
The impact of risk appetite on currencies and commodities:
Risk appetite and US dollar: – which measures the performance of the US currency against 6 major currencies – decreased by 0.15% to 105.13 points.
Appetite for Risk and Gold: Prices rose 0.43% to $1,776.00 an ounce and bullion futures contracts rose 0.43% to $1,789.00 an ounce.
Risk Appetite and Oil: Crude futures prices fell 0.57% to $82.19 a barrel and West Texas Intermediate crude prices fell 0.53% to $76.50 a barrel.
