Stocks Rally, Dollar in Worst Week Since February: Markets Wrap
Asian stocks extended a rally after their recent battering drove valuations to a two-year low, following a technology-supported advance in U.S. equities. The dollar held declines after U.S. inflation unexpectedly cooled in August.
With the dollar heading for its biggest weekly loss since February, prospects for U.S.-China trade talks and action by Turkey to support its currency, it all made for a positive tone Friday. Shares in Japan, South Korea and Hong Kong climbed, while China stocks underperformed. Oil headed for a weekly gain as traders keep watch on Hurricane Florences path to the U.S. east coast.
Chinas yuan stayed lower and equities in Shanghai did little after August economic data showed the economy in a modest slowdown. China aside, equities in Asia ended the week on a high after enduring the longest daily losing streak in 16 years.
News that the U.S. and Chinese governments are working out the details for a new round of trade talks helped lift sentiment, though its far from certain whether meaningful progress will eventuate. U.S. stocks pulled back from the days highs after President Donald Trump tweeted that the U.S. isnt under pressure to reach a trade agreement with China.
While U.S. equities are now highly priced, they could still go a lot higher, Robert Shiller, the Nobel laureate famed for his analysis of asset-price bubbles, said on Bloomberg Television. The U.S. is just doing great right now in terms of the strength of the economy and the stock market, with Trumps tax cuts and deregulation moves helping stoke sentiment, he said.
Gilt and pound traders were assessing a report that Bank of England Governor Mark Carney joined a cabinet meeting Thursday to explain that a no-deal Brexit would probably see interest rates rise rather than fall. The lira kept most of its gains after Turkeys larger-than-expected interest-rate hike.
Here are some key events coming up for the remainder of this week:
U.S. retail sales, industrial production, consumer sentiment on Friday.These are the main moves in markets:
Japans Topix index closed 1.1 percent higher. South Koreas Kospi index advanced 1.3 percent. Hong Kongs Hang Seng gained 1 percent. The Shanghai Composite advanced 0.1 percent. Australias S&P/ASX 200 Index rose 0.6 percent. Futures on the S&P 500 Index were little changed. The S&P 500 rose 0.5 percent Thursday. Futures on the U.K.s FTSE 100 Index rose 0.2 percent. The MSCI Emerging Market Index gained 1 percent, rising for a third straight day.
The yen held at 111.87 per dollar. The offshore yuan slid 0.1 percent to 6.8511 per dollar. The euro was little changed at $1.1693. The Bloomberg Dollar Spot Index was little changed Friday, down 0.9 percent for the week.
The yield on 10-year Treasuries held at 2.97 percent. Australian 10-year government bond yields were steady at about 2.61 percent.
West Texas Intermediate crude rose 0.2 percent to $68.75 a barrel. Gold rose 0.3 percent to $1,205 an ounce.
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