Abstract:Stocks gained in Asia on Monday amid improved risk sentiment after Wall Street rebounded strongly at the end of last week as oil prices eased, tempering fears of prolonged inflation and the accompanying aggressive Federal Reserve tightening.
Treasury yields remained subdued and the dollar hovered near the lowest in more than a week as investors continued to assess the outlook for U.S. rate hikes, and the potential for a recession.
Japan‘s Nikkei rallied 1.04%, while Australia’s benchmark jumped 1.69%.
Chinese blue chips rose 0.54% and Hong Kongs Hang Seng advanced 1.46%.
South Koreas Kospi gained 1.65%.
MSCIs broadest index of Asia-Pacific shares rose 1.31%.
However, U.S. stock futures point to a 0.25% decline when those markets reopen. On Friday, the S&P 500 surged more than 3%, adding to an almost 1% gain on Thursday.
“We‘ve had a decent end to the week in the U.S. markets and I think that’s going to be the main scene for Monday here in Asia,” amid a dearth of news or other new drivers, said Rob Carnell, chief economist for Asia-Pacific at ING.
“We‘ve had two decent equity days on the run now. It’s perhaps notable that youve had some consistency there.”
Crude oil fell in volatile trading on Monday as the market grapples with concerns that a global economic slowdown could depress demand versus worries about lost Russian supply amid sanctions over the Ukraine conflict.
Both Brent and U.S. West Texas Intermediate (WTI) futures fell more than a dollar earlier. But, prices have rebounded with Brent at $112.78 a barrel, down 34 cents, and WTI at $107.17, down 45 cents. [O/R]
U.S. long-term Treasury yields hovered around 3.13% after bouncing off a two-week low just above 3% at the end of last week as traders removed bets for hikes next year, but still pondered if aggressive tightening this year could trigger a recession.
Yields have dropped from 3.456%, the highest in more than a decade, reached before the mid-month Fed meeting. Then, the central bank hiked rates by 75 basis points, the biggest increase since 1994, and signalled that a similar move is possible in July.
“The market remains focused in the trade-off between the policy response to high inflation and fears of a hard landing,” Westpac rates strategist Damien McColough wrote in a client note.
“There will be ongoing discussions as to whether long-end yields have peaked, however we would not yet expect 10-year yields to fall materially or sustainably below 3%.”
The dollar was steady on Monday, continuing to consolidate near the lowest since the middle of the month against major peers.
The dollar index – which measures the currency versus six rivals – was little changed at 104.01, after gradually gravitating over the past few sessions toward the June 17 low of 103.83.
Disclaimer:
The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.
We are glad to announce that the high-score brokers: Easter event season S2 has started. The season will last from April 2024 to May 2024. During this event, participants can get easter eggs and enjoy multiple rewards. WikiFX has listed some brokers that offer luxury gifts or cashback bonuses for you.
In this article, we'll look in-depth at Vogage Markets, examining its key features. WikiFX aims to provide you with the information you need to make an informed decision about using this platform.
B2Broker increases leverage for major FOREX pairs to 1:200 and for BTC and ETH to 1:50, enhancing trading flexibility.
CySEC recently addressed the termination of Leverate Financial Services Ltd.'s membership in the Investors Compensation Fund (ICF), clarifying that clients remain eligible for compensation despite the loss of membership, while highlighting broader regulatory actions and enforcement measures undertaken by the commission.