Stocks in Asia were set to open higher after US shares climbed and Treasuries sold off as investors weighed fresh data that indicated further Federal Reserve tightening ahead.
(Bloomberg) — Stocks in Asia were set to open higher after US shares climbed and Treasuries sold off as investors weighed fresh data that indicated further Federal Reserve tightening ahead.
Equity futures for Australia, Japan and Hong Kong rose. The S&P 500 climbed 0.3% to close at its session high while the Nasdaq 100 ended the day 0.8% higher. Benchmark 10-year Treasury yields rose six basis points and an index of the dollar gained 0.6%.
The action echoed trading in the prior session as signs of a robust US economy that would compel a hawkish Fed response were shrugged off by equity investors. 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 new data follows a hotter-than-expected inflation print on Tuesday and comes ahead of US employment data to be released Thursday that is 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 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 jumped 8.7%, 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 dropped below $79 a barrel 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 7:18 a.m. Tokyo time:
Stocks
- Nikkei 225 futures rose 0.8%
- Hang Seng futures rose 0.2%
- S&P/ASX 200 futures rose 0.5%
- The S&P 500 rose 0.3%
- The Nasdaq 100 rose 0.8%
Currencies
- The Bloomberg Dollar Spot Index rose 0.6%
- The euro was little changed at $1.0690
- The Japanese yen was little changed at 134.07 per dollar
- The offshore yuan was little changed at 6.8616 per dollar
Cryptocurrencies
- Bitcoin rose 0.5% to $24,307.56
- Ether rose 0.3% to $1,671.7
Bonds
- The yield on 10-year Treasuries advanced six basis points to 3.80%
- Australia’s 10-year yield advanced seven basis points to 3.81%
Commodities
- Spot gold was unchanged at $1,836.01 an ounce
This story was produced with the assistance of Bloomberg Automation.
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