Stocks
Asian Markets React to US Inflation Data, Dollar Hits 34-Year High Against Yen
Asian markets experienced a reversal on Thursday following forecast-topping US inflation data, which dealt a substantial blow to hopes for a June interest rate cut. Traders were forced to re-evaluate the outlook for monetary policy, with a warning that the next move could even be a hike.
The losses mirrored a sell-off on Wall Street and resulted in the dollar reaching a 34-year high against the yen, sparking speculation that Japanese authorities would intervene to support their struggling currency.
Figures revealing a 0.4 percent on-month and 3.5 percent on-year increase in the consumer price index were both above consensus for the third consecutive month. Observers cautioned that the pick-up might not be a temporary blip but could indicate a concerning trend.
These numbers followed other data, including a forecast-beating jobs report, suggesting that the US economy, despite borrowing costs being at a two-decade high and inflation well above target, remained robust.
The reading provides Federal Reserve officials with more to consider ahead of their May policy meeting, with their recent guidance of three rate cuts this year now in question.
Investors began the year hopeful that the central bank would implement six cuts in 2024, starting with one in March. However, they are now considering at most two cuts, with the likelihood of a June reduction decreasing.
However, some remain less optimistic. Torsten Slok from Apollo Global Management stated, “We are sticking to our view that the Fed will not cut rates in 2024.” Meanwhile, former Treasury Secretary Lawrence Summers warned that traders must “take seriously the possibility that the next rate move will be upwards rather than downwards.”
Despite concerns, minutes from the Fed’s recent meeting indicated that while decision-makers were apprehensive about recent figures, they still envisioned cuts this year.
“However, a few participants noted that residual seasonality could have affected the inflation readings at the start of the year,” the Fed stated.
Neil Wilson from Finalto added that “despite the hot number, there are many reasons why the Fed may still cut in June… but if the market moves too far out of step then the Fed may be forced to wait a little longer.”
The disappointing data sent all three main indexes on Wall Street into the red, and Asia followed suit, with Hong Kong, Tokyo, Sydney, Seoul, Singapore, Wellington, Taipei, and Manila all seeing declines.
“The fallout from the hotter-than-expected US inflation read… will reverberate across regional equity markets (Thursday),” observed Tony Sycamore of IG Australia.
“Investors were keeping tabs on Tokyo as the dollar surged to 153.24 yen, the strongest since 1990, on the US CPI reading.”
Authorities in Tokyo have indicated they would keep their options open on supporting the yen. However, while top currency official Masato Kanda has attributed volatility in the dollar-yen exchange to speculators, analysts noted that the latest moves were more related to the US data.
“It’s clearly a US dollar move and Japanese officials can’t really argue its speculators attacking the yen,” commented Peter Vassallo of BNP Paribas Asset Management.
Major General Mohammad Quamruzzaman (retd) has stepped down from his role as an independent director of the board of the Dhaka Stock Exchange, citing personal reasons.
He also served as a member of the DSE’s Nomination and Remuneration Committee (NRC).
Quamruzzaman was appointed to the DSE board on 1 September 2024, following the fall of the Awami League-led government. After serving for nearly one year and nine months, he submitted his resignation on Saturday (24 May).
Speaking to Quamruzzaman confirmed his resignation, saying, “Yes, I have resigned as an independent director for personal reasons.”
Md Shafiqur Rahman, Deputy General Manager of Public Relations and Publications at the DSE, said Quamruzzaman submitted a resignation letter mentioning personal reasons behind his decision.
“The DSE board will now take a decision regarding the resignation,” Shafiqur Rahman said.
He also indicated that Quamruzzaman may be planning to join another company, which could have influenced his decision to resign.
Earlier, another independent director of the DSE board, Shahnaz Sultana, also resigned from her position. She was likewise a member of the NRC.
According to the DSE annual report, Shahnaz Sultana is the CEO and Chief Consultant of FINS Alliance Risk Advisory and Consultancy and has served as the Founder and Chairperson of the WE Global Women Foundation since 2020.
The Bangladesh Securities and Exchange Commission (BSEC) has today approved appointment of Ms. Nuzhat Anwar as the new Managing Director of Dhaka Stock Exchange PLC. (DSE).
Ms. Nuzhat Anwar brings over two decades of experience in financial markets, banking, and development finance. Prior to her appointment, she worked at the International Finance Corporation (IFC), the private sector arm of the World Bank Group, where she held multiple senior leadership roles across Africa and South Asia. Her positions included Resident Representative for Liberia and Sierra Leone, Senior Country Officer for Bangladesh covering Bangladesh, Bhutan, and Nepal, and acting Cluster Manager during the COVID-19 pandemic and the subsequent transition period.
Ms. Anwar also served as an IFC Country Officer in Botswana and Namibia, where she played a key role in establishing IFC’s presence in Gaborone and advancing a sustainable investment program, including IFC’s first investment in Botswana. She offers deep expertise in capital management, treasury and liquidity, transaction services, portfolio optimization, and market advocacy. Earlier in her career, she spent 16 years with Citibank Bangladesh and Standard Chartered Bank Bangladesh in various senior management roles.
Ms. Anwar holds a Master’s degree in Commerce (Finance) from the University of Dhaka.
On her appointment as the Managing Director of DSE, the Chairman of the Board of DSE Mr. Mominul Islam said, “We are pleased to receive the approval of BSEC for appointment of Ms. Anwar as the new Managing Director. Over the last one year the NRC and Board of have worked hard to recruit a competent leader as the MD of DSE. We are confident that Ms. Anwar, with her excellent leadership trait, vast experience in the financial sector in home and abroad and deep passion for transformation in the Capital Market of the Country, is the right candidate to lead DSE in the days ahead. Now, we will complete the internal processes to onboard Ms. Anwar at soonest.”
Dhaka Stock Market DSE, Bourse on the second working day of the week, 30th September, ended with a negative performance in Indices and a hike in Turnover from the previous working session. This information is known from DSE sources.
503 crore 90 lakh taka shares were traded on this day. 22 crore 58 lakh more tradings were done in DSE today compared to the previous workday, 29th September, Shares worth Tk 481 crores 31 lakh shares were traded last time, Sunday.
The benchmark DSEX lost 33.61 points or 5,624 The Shariah-based index DSES dropped 7.36 point or 1,263 and the blue-chip index DS30 decreased by 9.57 points or 2,053.
Of the issues traded, 72 advanced, 299 declined and 25 remained unchanged.
Shahjibazar Power Company Limited ranked top gainer on DSE, the share price increased by Tk 4.00 paisa or 9.76 percent. On this day, the share was last traded at Tk 45.00 paisa.
Dhaka Electric Supply Company Limited ranked top loser on the DSE, the share price dropped by Tk 1.80 paisa or 7.56 percent. On this day, the share was last traded at Tk 22.00 paisa.
DSE topped on trade is Pragati Life Insurance Limited 25 crore 35 lakh takas of company shares have been traded.
A total of 27 companies’ shares were traded in the Block on Dhaka Stock Exchange. A total of 1 crore 50 lakh 42 thousand 956 shares of the companies were traded. The financial value of which is 65 crore 60 lakh taka
