Dollar Drops on Trade Talks, Treasury Yields Rise: Markets Wrap

FILE PHOTO: Men look at an electronic board showing stock information at a brokerage house in Beijing, China, January 5, 2016. REUTERS/Kim Kyung-Hoon/File Photo

The dollar declined and U.S. equity futures climbed alongside Treasury yields, while the yuan jumped after China said its vice commerce minister will visit America for trade talks in late August.

S&P 500 Index futures rose and the greenback, which has seen recent strength on its role of a haven, fell for the first time in six days. Stocks stayed lower in most Asian markets though pared declines as news broke of the proposed meeting. Oil got a reprieve after slumping on a report that showed a gain in American stockpiles. Hopes on trade gave the Australian dollar a boost, while China’s offshore yuan had the biggest rally in more than a year. Emerging-market shares slipped, with the intraday drop from their January high reaching 20 percent.

The potential for a breakthrough in the trade standoff between China and the U.S. is helping shake off some of the caution that’s weakened risk assets over the past week. Markets have been rocked as turmoil in Turkey weighed on sentiment across many emerging- and developed-nation assets.

The Turkish lira edged lower Thursday after spiking as Turkey moved to deter short-selling of the currency while Qatar promised Wednesday to invest $15 billion in the Turkish economy to help the country avert a financial crisis.

Elsewhere, metals rebounded after a hammering Wednesday. In Hong Kong, currency interventions continued after the currency fell to the weak end of its trading band.

Here are some key events coming up this week:

Earnings are still to come from companies including Maersk and Carlsberg. Brexit talks between the EU and the U.K. resume in Brussels Thursday.

These are the main moves in markets: Stocks

Japan’s Topix index fell 0.6 percent at the 3 p.m. close in Tokyo. Hong Kong’s Hang Seng Index slid 0.7 percent. South Korea’s Kospi index lost 0.9 percent. Futures on the S&P 500 Index rose 0.4 percent. FTSE 100 futures gained 0.8 percent.

Currencies

The yen dipped 0.1 percent to 110.86 per dollar. The offshore yuan gained 1 percent to 6.8820 per dollar. The euro advanced 0.4 percent to $1.1385. The Bloomberg Dollar Spot Index fell 0.3 percent.

Bonds

The yield on 10-year Treasuries rose two basis points to 2.88 percent. Australian 10-year bond yields slid one basis point to 2.57 percent.

Commodities

West Texas Intermediate crude traded at $65.14 a barrel. LME copper was up 1.4 percent after sinking 4 percent. Gold was little changed at $1,176.03 an ounce.

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