(Bloomberg) — Asian stocks were mixed in cautious trading as investors braced for coming days of economic data and remarks from Federal Reserve speakers that will help determine the outlook for interest rates. became. Japan’s two-year bond yield has risen to its highest level in more than a decade.
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Stock prices in Japan, South Korea and Taiwan fell, but most Chinese stocks rose. On Monday, the S&P 500 fell for the first time in four days. That’s as recent gains lost steam ahead of data later this week, including the Federal Reserve’s recommended inflation measure on Thursday. US stock futures are slightly lower.
Japan’s two-year bond yield rose to its highest level since 2011 as stronger-than-expected inflation data increased expectations that the central bank will end its negative interest rate policy in the coming months. Traders have raised the probability that the Bank of Japan will end its negative interest rate policy by April to about 81% from 78% on Monday, according to swaps data compiled by Bloomberg. The yen appreciated against the dollar.
“As with other major economies, the trend of higher service inflation driven by faster wage growth is permeating Japan, albeit more subduedly,” said Peter Dragicevic, currency strategist at Kopay Solutions in Sydney. said. “There remains pressure on the Bank of Japan to shift away from its excessively accommodative policy stance, so the risk of the yen appreciating from here is greater,” he said.
Asian equity benchmarks are heading for monthly gains, led by gains in Japanese and Chinese markets. However, there is still a lot of uncertainty in the market around factors such as the possibility of Fed rate cuts, the possibility of additional support from China, and whether stock valuations are attractive enough to support further gains.
“Our sense is that the overall valuation is fair,” Sunil Khur, a strategist at Goldman Sachs Group, told Bloomberg TV. From here, “it’s the underlying profit offering that will move the market. This year he plans for 15% profit growth in the region,” he said.
Read more: BlackRock says Japanese stocks can “reach new all-time highs”
More purchases are expected In China, government-backed funds have poured more than 410 billion yuan ($57 billion) into domestic stocks this year to support the market, according to UBS Group AG estimates. The Swiss bank based its calculations on “excess” trading in 54 Chinese exchange-traded funds.
Fast fashion company Shein is considering the possibility of changing its initial public offering from New York to London due to hurdles in listing in the United States, according to people familiar with the matter. Shein was founded in China and is currently headquartered in Singapore.
Samsonite International is considering its options after receiving the rights from a suitor, including an acquisition company, the people said.
Read more: Debt-ridden companies seek equity capital as interest costs soar
In Asia, there was little change in government debt. Wall Street will be watching to see how the market absorbs the large amount of Treasury and corporate sales amid month-end positioning. U.S. yields rose following Monday’s two-year and five-year bond auctions. Meanwhile, blue-chip U.S. companies sold a record $172 billion in corporate bonds in February as they scrambled to capture investor demand as borrowing costs fell.
Elsewhere, Bitcoin briefly surpassed the $57,000 level for the first time since late 2021, supported by investor demand through exchange-traded funds (ETFs) and additional purchases by MicroStrategy.
In commodities, global benchmark Brent crude rose on Monday to trade above $82 a barrel, while gold rose for two weeks as markets wait for further clues about when the Fed will start cutting rates. The price has stabilized around the highest price for the first time in a while.
This week’s main events:
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BOE Governor Andrew Bailey speaks on Tuesday
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US Conference Consumer Confidence Index, Durable Goods, Tuesday
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Michigan Republican and Democratic presidential primaries Tuesday
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Reserve Bank of New Zealand policy decisions Wednesday
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Eurozone economic confidence, consumer confidence, Wednesday
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US wholesale inventories, GDP, Wednesday
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Fed’s Rafael Bostic, Susan Collins and John Williams speak on Wednesday
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G20 finance ministers and central bank chiefs will meet in Sao Paulo from Wednesday to Thursday
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German CPI, unemployment rate, Thursday
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US Consumer Income, PCE Deflator, New Unemployment Insurance Claims, Thursday
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Fed’s Austan Goolsby, Raphael Bostic and Loretta Mester speak Thursday
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China official PMI, Caixin manufacturing PMI, Friday
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Eurozone S&P World Manufacturing PMI, CPI, Unemployment Rate, Friday
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BOE Chief Economist Hugh Pill speaks on Friday
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US Construction Spending, ISM Manufacturing, University of Michigan Consumer Sentiment, Friday
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Fed’s Rafael Bostic and Mary Daly speak on Friday
The main movements in the market are:
stock
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S&P 500 futures were little changed as of 1:23 p.m. Tokyo time.
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Nasdaq 100 futures fell 0.2%
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Japan’s TOPIX rose 0.1%
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Australia’s S&P/ASX 200 rose 0.1%
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Hong Kong’s Hang Seng fell 0.4%.
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The Shanghai Composite rose 0.5%.
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Euro Stoxx50 futures fell 0.2%
currency
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Bloomberg Dollar Spot Index little changed
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The euro was almost unchanged at $1.0854.
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The Japanese yen rose 0.2% to 150.42 yen to the dollar.
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The offshore yuan was almost unchanged at 7.2097 yuan to the dollar.
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The Australian dollar was almost unchanged at US$0.6543.
cryptocurrency
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Bitcoin rose 2.3% to $55,911.82
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Ether rose 1.2% to $3,225.1
bond
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The 10-year government bond yield was almost unchanged at 4.27%.
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Japan’s 10-year bond yield rose 1.5 basis points to 0.700%.
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The Australian 10-year bond yield rose 4 basis points to 4.14%.
merchandise
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West Texas Intermediate crude oil is little changed.
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Spot gold rose 0.1% to $2,034.04 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Jason Scott.
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