Breakfast Bites - BoJ hikes & now Market wait for the Fed

Rise and shine everyone.

It’s a busy, busy day. Markets are dealing with the fallout from Microsoft’s earnings, but AMD has managed to breathe life back into the semi’s. AMD, Nvdia and Broadcomm (AVGO) are all trading higher in the pre-market.

But first, the Bank of Japan. They hiked by 15bps, taking their rate to 0.25% now. While the question of a hike was on the table few, including me, believed it would happen. On the other hand, the tapering of bond purchases came in slower than expected. We ended up with that one odd scenario under my analysis that I posted yesterday:

The Yen moved higher but, gave up early gains. After Governor Ueda’s press conference, the Yen strengthened significantly, with the USD/JPY below 150. The Nikkei moved higher, as did bond yields. (More below)

Asian markets were higher across the board after the BoJ, and Australia’s inflation rate coming in lower. But, even China and Hong Kong saw a surge, even though PMIs came in slightly weaker this morning.

And now on to the Fed. The market is not pricing in a hike for the July meeting. Goldman Sachs was the only one hinting at a July cut but their most recent preview suggests September. We also have Brazil’s rate decision this evening, and the Bank of England tomorrow.

The other major news this morning is Crude Oil. Yesterday, WTI dropped below $75/bbl. After the overnight attack in the Middle East crude surged by about 2.5%, taking it back above $76.70.

US Equity Futures are higher, with the Nasdaq leading the way with some strength. Commodities are higher across the board, with Copper leading the way. Bitcoin is lower.

Meta reports after the close today.

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