While everyone is talking about interest rate cuts, Japan has just raised its rates. It hadn't done so since 2007, and had been applying negative rates since 2016. The move isn't likely to change the face of the world, especially because it's a small jump: the Bank of Japan's short-term rates have gone from -0.1% to the 0 to 0.1% range. This is a symbolic move, made possible by the resurgence of inflation after a long period of deflation. The BOJ took the opportunity to clean up its exceptional measures: no more yield curve control, no more ETF purchases, no more support for real estate funds.

While we're on the subject of central banks, let's add the Reserve Bank of Australia (RBA). Australian rates were maintained at 4.35%, as expected, but the institution was more flexible on their evolution. In other words, there is now little chance of a rate hike. The market even thinks that a cut will be made in August. Here again, this was pretty much in line with investors' expectations. The best proof of this is the fact that the Japanese and Australian stock market indices rose after the decisions and the yen is falling.

In any case, the financial world couldn't care less about the BOJ and RBA this week. What matters is artificial intelligence and guarantees from the US central bank. On the first point, Nvidia did the job yesterday at the opening of its developer conference in San José, announcing its new supercharged chip and several partnerships. Despite all the hype, the stock just gained 0.7% at the end of the session, less than the Nasdaq 100 (+0.99%). Perhaps a sign that the market is getting used to these kinds of announcements?

Tomorrow, the Fed won't be touching rates, but investors are awaiting Jerome Powell's comments on the future course of monetary policy to see whether the Fed head is neutral, grumpy or perky. The Fed will also publish a document containing the dot plot, an anonymous table of the positions of each of its members on the evolution of rates, always rich in information for the markets. Given recent statistics, investors are less confident about a first rate cut in June (the probability fell yesterday to 55.1%), but have not given up. However, they’re able to tolerate a slide until the July meeting. Conversely, any signal that the easing of monetary policy will be further delayed risks undermining sentiment.

In the Asia-Pacific region this morning, Japan and Australia have maintained their gains. China, on the other hand, is falling, with -1.2% in Hong Kong; South Korea and India lost 1%, more out of a wait-and-see attitude in anticipation of the Fed's cleaver than for any underlying reasons. This caution is reflected in Europe: the Stoxx EU 600 and the FTSEZ 100 are flat. On Wall Street, Nasdaq 100 futures is down 0.4%, S&P 500 futures lost 0.1% and Dow Jones futures is flat.

Today's economic highlights:

Japan and Australia’s monetary policy decisions, the German ZEW survey for March and February's US building permits and housing starts are today’s main indicators. The full agenda is here. 

The dollar is worth EU 0.9212 and GBP¨0.7872. The ounce of gold rises to USD 2,157. Oil continues to rise, with North Sea Brent at USD 86.41 a barrel and US light crude WTI at USD 82.17. The yield on 10-year US debt stands at 4.31%. Bitcoin is trading at USD 63,639.

In corporate news:

  • Nvidia’s share price fell by around 1% in pre-market trading after the company unveiled a new chip, the Blackwell B200, designed for artificial intelligence. Nvidia's share price has more than tripled over the past year. 
  • Meta Platforms proposes to almost halve the monthly subscription fee for Facebook and Instagram from 9.99 euros to 5.99 euros, following discussions with European data protection authorities, a senior group official said on Tuesday.
  • Boeing - Airbus CEO Guillaume Faury said on Tuesday that the technical problems affecting its US competitor were no cause for satisfaction, as they were damaging the image of the entire aerospace industry.
  • Tencent Music Entertainment Group - The Wall Street-listed Chinese group reported better-than-consensus quarterly sales on Tuesday, thanks to growth in its paid music streaming subscriptions. The stock gained 2% in pre-market trading.
  • Kroger announced on Monday evening that it had reached a definitive agreement to sell its specialty pharmacy division to CarelonRx, a subsidiary of health insurer Elevance Health.
  • Super Micro Computer - The manufacturer of servers optimized for artificial intelligence fell 9% in pre-market trading as it sought to raise funds.
  • Spire Global soared 18.5% in premarket trading after the company announced a collaboration with Nvidia in artificial intelligence-based weather forecasting.

Analyst recommendations:

  • 3M Company: Barclays upgrades to overweight from equalweight with a price target raised from USD 111 to USD 126.
  • American Tower Corporation: ARC Independent Research downgrades to hold from buy with a price target raised from USD 210 to USD 212.
  • Fifth Third Bancorp: Stephens downgrades to equalweight from overweight with a target price of USD 41.
  • Mongodb, Inc.: Redburn Atlantic downgrades to sell from neutral with a price target reduced from USD 410 to USD 295.
  • Crh Plc: Morgan Stanley maintains its market weight recommendation and raises the target price from 68 to USD 83.
  • Micron Technology, Inc.: Baird maintains a neutral recommendation with a price target raised from USD 78 to USD 115.
  • The Cooper Companies, Inc.: Redburn Atlantic upgrades to buy from neutral with a price target reduced from USD 375 to USD 125.
  • Nvidia Corporation: Cantor Fitzgerald maintains its overweight recommendation and raises the target price from USD 900 to USD 1200.
  • Snowflake Inc.: Redburn Atlantic downgrades to sell from neutral with a price target reduced from USD 180 to USD 125.
  • Convatec Group Plc: Investec downgrades to hold from buy with a price target raised from GBX 292 to GBX 307.
  • Johnson Matthey Plc: AlphaValue/Baader Europe downgrades to reduce from add with a price target reduced from GBX 1856 to GBX 1790.
  • Reckitt Benckiser: Kepler Cheuvreux downgrades to hold from buy with a price target reduced from GBX 6900 to GBX 5000.
  • Vistry Group Plc: RBC Capital upgrades to sector perform from underperform with a price target raised from GBX 825 to GBX 1400.