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Moving markets: Five things shaping the FTSE 100 today

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Moving Markets Today: Asia Stocks Rise, Oil Prices Surge Amid Middle East Tensions; Three American Soldiers Killed in Jordan; U.S. Fed, BOE Policy Decisions, and ‘FAAMG’ Earnings in Focus 

Stock markets in Asia kicked off the week with strong gains, fuelled by a surge in Chinese equities following regulatory interventions aimed at stabilizing the market. Meanwhile, oil prices surged amid rising tensions in the Middle East. A drone strike in Jordan, suspected to be linked to Iran, resulted in the tragic deaths of three U.S. troops and left up to 34 others injured. Investors are closely watching for rate decisions from both the U.S. Federal Open Market Committee and the Bank of England this week. Furthermore, the tech sector is gearing up for a pivotal period with earnings reports expected from FAAMG companies, including Apple, Google-parent Alphabet, Amazon.com, Microsoft, and Meta, promising significant market movements and insights into the industry’s performance. Here are five key takeaways for your day. 

Hong Kong Court Orders Liquidation of China’s Evergrande 

A Hong Kong court has decided to initiate the winding-up process for China Evergrande, marking a pivotal and uncertain turn in the collapse of the world’s most indebted property developer. The ruling came from High Court Judge Linda Chan after the company couldn’t propose a restructuring plan satisfactory to international creditors, despite lengthy negotiations. Evergrande’s liabilities surpassed $300 billion when it defaulted in 2021. 

Oil Prices Surge Following Attack on US Base in Jordan; Three American Soldiers Killed 

Oil futures experienced a notable increase on Monday morning in Asia after President Joe Biden revealed that three service members lost their lives in a drone attack by Iran-backed militants on a U.S. military base in Jordan. Brent crude, the international standard for oil prices, surged by up to 1.5 percent in early trading, reaching $84.80 per barrel. Similarly, the U.S. benchmark West Texas Intermediate also rose by as much as 1.6 percent, hitting $79.29 per barrel. These fatalities represent the first instance of U.S. troops being killed in an attack in the Middle East since the Israel-Hamas conflict unfolded in Gaza back in October. 

China’s Industrial Profits Drop 2.3% in 2023 Amid Economic Pressures 

China’s industrial firms saw profits fall by 2.3% in 2023, marking the second straight year of decline due to sluggish domestic and international demand, Reuters reported. This adds pressure on economic growth amidst a property slump and deflationary risks. The National Bureau of Statistics (NBS) reported the decline, following a 4.4% profit fall in the first 11 months compared to the previous year. 

This Week’s Spotlight: U.S. Fed and BOE and FAAMG Earnings Take Centre Stage 

This week, the U.S. Federal Open Market Committee and the Bank of England are set to announce their decisions regarding interest rates. While there’s an expectation for rate reductions from both central banks, it’s unlikely to occur during this month’s announcements. Central bankers have been exercising a cautious approach and are likely to continue observing the economic landscape before making significant moves. Looking ahead, all eyes are on the quarterly earnings reports from tech giants like Apple, Microsoft, Amazon, Alphabet, and Meta Platforms. These reports will offer valuable insights into whether the impressive surges in their stock prices since 2022’s low point on Wall Street are justified by their performance and financial health. 

Asian Stocks Rally on Chinese Boost; Bitcoin Inches Up to $42,494 

Hong Kong’s Hang Seng index surged by 1.4% following China’s securities regulator’s announcement on the suspension of restricted share lending, prompting a 3.6% jump in mainland property shares. Regional markets also rose: Japan’s Nikkei 225 climbed 0.8%, South Korea’s Kospi advanced 1.2%, and Australia’s benchmark added 0.4%. Mainland China’s CSI300 remained stable. The U.S. dollar index held steady at 103.52, while long-term Treasury yields dipped slightly to 4.1316%. Gold rose 0.23% to $2,023.39, and bitcoin increased to $42,494.

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