Asian Stocks Show Muted Gains; Treasuries Slip: Markets Wrap

Publikuota: 2018-07-10
FILE PHOTO: An investor holds onto prayer beads as he watches a board showing stock prices at a brokerage office in Beijing, China, July 6, 2015.  REUTERS/Kim Kyung-Hoon/File Photo
FILE PHOTO: An investor holds onto prayer beads as he watches a board showing stock prices at a brokerage office in Beijing, China, July 6, 2015. REUTERS/Kim Kyung-Hoon/File Photo
 

Stocks in Asia edged higher, extending a rise from a nine-month low amid optimism the upcoming earnings season will be robust enough to overshadow a rise in trade tensions.

Equities in Japan, Hong Kong and South Korea rose after the S&P 500 Index climbed to the upper end of its recent trading range. Regional gains were muted as shares in Shanghai and Sydney bucked the positive trend. Still, the yen fell past 111 per dollar and 10-year Treasury yields ticked higher as risk aversion faded. With U.S. President Donald Trump focusing on a Supreme Court pick and upcoming trip to Europe, trade-war headlines have faded since last Friday’s imposition of U.S. and Chinese tariff hikes.

With JPMorgan Chase & Co. and Wells Fargo among those companies kicking off earnings season later this week, there’s hope that strong results can buffet a run of positive economic data. While trade tension may have put a lid on investment gains, it has done little to estimates for profits which are still expected to grow at 20 percent in the second quarter.

“Strong U.S. growth is leading the global expansion and powering corporate earnings, but uncertainty around the outlook is rising and financial conditions are tightening,” said Richard Turnill, global chief investment strategist at BlackRock Inc.

The pound remained under pressure after the resignation of two of U.K. Prime Minister Theresa May’s most senior ministers in one day, throwing the U.K. government into turmoil over negotiations to leave the European Union. Elsewhere, crude fluctuated around $74 a barrel in New York as U.S. crude stockpiles were seen declining for the fourth time in five weeks.

These are some events to look out for this week:

Chinese trade data due at the end of the week will probably show slightly slower export growth, after early indicators pointed to softer overseas demand and weaker export orders, Bloomberg Economics said. The most noteworthy U.S. data is the June inflation report on Thursday, which consensus expects will show both headline and core price growth picking up. There’s another deluge of Treasury debt sales too, with a total $156 billion of notes and bills offered. Earnings season gets going with JPMorgan and Citigroup among the largest companies due to give results, as well as India’s Infosys Ltd.

Here are the main market moves: Stocks

Japan’s Topix index rose 0.7 percent at 2:30 p.m. in Tokyo. Hong Kong’s Hang Seng added 0.3 percent. The Shanghai Composite index slid 0.3 percent. Australia’s S&P/ASX 200 Index slipped 0.3 percent. Futures on the S&P 500 rose 0.2 percent. The underlying gauge gained 0.9 percent Monday for its third day of gains. Futures on the U.K.’s FTSE 100 advanced 0.1 percent.

Currencies

The Bloomberg Dollar Spot Index was little changed. The euro was little changed at $1.1744. The pound fell 0.2 percent to $1.3238. The Japanese yen slid 0.3 percent to 111.19 per dollar.

Bonds

The yield on 10-year Treasuries was up one basis point to 2.86 percent. Australian 10-year government bond yields added two basis points to 2.635 percent.

Commodities

West Texas Intermediate crude rose 0.6 percent to $74.28 a barrel. Gold futures rose 0.1 percent to $1,258.42 an ounce.

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