Stocks in Asia rose alongside US share futures, adding fuel to a global equity rally that appeared to shrug off the prospect of higher interest rates following strong economic data from the US.
(Bloomberg) — Stocks in Asia rose alongside US share futures, adding fuel to a global equity rally that appeared to shrug off the prospect of higher interest rates following strong economic data from the US.
Equities in Australia, South Korea, Japan and China gained ground, pushing a gauge of the region’s stocks toward its best day in a month. The advance for Hong Kong shares snapped a four-day run of declines as JD.com Inc., Nio Inc. and Tencent Holdings Ltd. rose.
Equity futures for Europe and US benchmarks also gained after the S&P 500 climbed 0.3% to close at its session high Wednesday while the Nasdaq 100 ended the day 0.8% higher.
The dollar fell against all G-10 currencies while the yen strengthened. The Australian dollar edged higher after initially tumbling on a surprise rise in the jobless rate, indicating higher interest rates are taking a toll on the economy. The news pared an advance in Australian bond yields. Benchmark 10-year US Treasury yields were flat after increasing six basis points on Wednesday.
Gains for US stocks on Wednesday came after the release of robust economic data that will likely compel a hawkish Fed response. US retail sales in January jumped by the most in almost two years and homebuilder sentiment rose in February by the most since mid-2020.
The data follow a hotter-than-expected inflation print on Tuesday and come ahead of US employment data to be released Thursday that are expected to show an uptick in jobless claims.
The market “is telling us maybe we can keep going as long as inflation is coming down overall and growth is solid,” Quincy Krosby, chief global strategist for LPL Financial, said in an interview with Bloomberg Television.
The rally in risk assets helped propel higher some of the most speculative corners of the market. A Goldman Sachs Group Inc. benchmark of non-profitable tech companies rose 4.4% and is up almost 30% this year. Bitcoin rose further after jumping 8.7% Wednesday, the most in three months, to reach the highest level since August.
“Everybody is trying to figure out whether this is going to be a once-in-a-lifetime soft landing or if it’s just taking longer before we get a panic recession,” Jerry Braakman, chief investment officer of First American Trust, said in an interview. “That’s why you’re seeing a lot of divergence between bulls and bears.”
Oil futures climbed following a Wednesday decline after EIA reported that crude inventories rose over 16 million barrels last week.
Cisco Systems Inc. shares rose as much as 10% in late trading after it gave an upbeat revenue prediction that suggested that spending on tech infrastructure is holding up better than expected. Devon Energy Corp. fell more than 10% after fourth-quarter earnings missed estimates.
Key events:
- US jobless claims, Australia unemployment, Cleveland Fed President Loretta Mester speaks at Global Interdependence Center event Thursday
- France CPI, Russia GDP Friday
Some of the main moves in markets as of 12:35 p.m. Tokyo time:
Stocks
- S&P 500 futures rose 0.2%. The S&P 500 rose 0.3%
- Nasdaq 100 futures rose 0.4%. The Nasdaq 100 rose 0.8%
- Japan’s Topix rose 0.7%
- Australia’s S&P/ASX 200 rose 0.8%
- Hong Kong’s Hang Seng rose 2.1%
- The Shanghai Composite rose 0.8%
- Euro Stoxx 50 futures rose 0.5%
Currencies
- The Bloomberg Dollar Spot Index fell 0.2%
- The euro rose 0.2% to $1.0709
- The Japanese yen rose 0.3% to 133.74 per dollar
- The offshore yuan was little changed at 6.8573 per dollar
Cryptocurrencies
- Bitcoin rose 2.2% to $24,711.08
- Ether rose 1.6% to $1,692.59
Bonds
- The yield on 10-year Treasuries declined two basis points to 3.78%
- Australia’s 10-year yield advanced one basis point to 3.75%
Commodities
- West Texas Intermediate crude rose 0.6% to $79.05 a barrel
- Spot gold rose 0.2% to $1,839.70 an ounce
This story was produced with the assistance of Bloomberg Automation.
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