TSMC Shares Dip Amid Taiwan Quake, Yen Stabilises

Equities

The FTSE 100 saw a slight decline of 0.2%, affected by a cautious mood over interest rates which might remain high for an extended period. Despite this, the fall was somewhat offset by gains in commodities-linked stocks, thanks to rising crude prices and strong factory data from China boosting industrial metal miners.

HSBC saw a modest increase of 0.4% following the news of an estimated gain of $4.9 billion from the sale of its Canadian unit to Royal Bank of Canada. This development comes as the bank also considers the sale of some of its German operations. However, fashion chain Superdry faced a sharp 55% drop after the announcement that chief executive Julian Dunkerton will not proceed with a buyout offer for the company.

Across the pond in the US, the stock market faced challenges with the Dow Jones Industrial Average dropping 1%, the S&P 500 falling 0.72%, and the Nasdaq Composite decreasing by 0.95%. This downturn was influenced by concerns over the Federal Reserve potentially delaying interest rate cuts and Tesla's shares falling 4.9% after reporting fewer quarterly deliveries, marking its first such decline in nearly four years. Healthcare stocks also took a hit, with companies like UnitedHealth, CVS Health, and Humana declining after disappointing Medicare reimbursement rates were announced.

Forex & Commodities

On Tuesday, the US dollar witnessed a dip after previously reaching its highest level in nearly five months, influenced by a report showing steady US job openings in February. This movement contrasted with the Japanese yen, which saw a gain against the dollar, following Japan's heightened warnings against currency intervention. The yen had reached a 34-year low the previous Wednesday, prompting these warnings.

The dollar index initially climbed to its highest point since mid-November, driven by robust US manufacturing data. However, it later fell slightly following the job openings report and an increase in factory orders.

The British pound improved slightly against the dollar after positive manufacturing data. Meanwhile, China's yuan reached a 4-1/2-month low against the dollar, impacted by a strong US currency despite intervention by state-owned banks. The euro also saw a minor uplift after dropping to its lowest since mid-February, amid worsening factory conditions in the eurozone.

Gold prices reached new record highs, driven by increasing Middle East tensions and a rush towards the safe-haven asset, despite the stronger dollar and mixed expectations for US rate cuts.

Oil prices continued their upward trajectory, reflecting concerns over potential supply disruptions.