After US markets closed unchanged on Thursday, shares in Asia fluctuated as investors weighed the possibility of rising interest rates with a slowing of inflation. While mainland China and Hong Kong markets oscillated following the opening bell, Australian stocks pared early losses. After the S&P 500 lost some of its early gains to close flat, …
After US markets closed unchanged on Thursday, shares in Asia fluctuated as investors weighed the possibility of rising interest rates with a slowing of inflation. While mainland China and Hong Kong markets oscillated following the opening bell, Australian stocks pared early losses. After the S&P 500 lost some of its early gains to close flat, while the Nasdaq 100 gained 0.2%, US market futures gained pace. The South Korean Kospi Index traded marginally higher. Shares of Alibaba Group Holding Ltd increased as the business exceeded sales projections. Stocks of Country Garden Holdings Co. were headed for a record close after a drop. The Chinese developer offered more details to its recent estimate, which fueled stock and bond falls, and now anticipates reporting a multibillion-dollar loss for the first half of this year. As activity declines due to a vacation in Tokyo, traders will be keeping a close check on the yen and the crucial 145 level vs the dollar. The yen is still weak and approaching levels that prompted the finance ministry to intervene last year due to the continually big yield differential between Japan and the US.
The US inflation data that was presented on Thursday mostly met expectations. In favor of risk assets, the core measure—which includes food and energy—registered the smallest back-to-back increase in more than two years. Despite this, Francisco President Mary Daly told Yahoo! Finance that the central bank still has “more work to do” to stop inflation. After longer-term US yields increased as a result of a disappointing 30-year bond auction, Daly’s remarks hurt Treasuries and further soured investor sentiment. The highest rate since 2011 was obtained at the $23 billion auction. Seema Shah, chief global strategist at Principal Asset Management, stated that “the case is strengthening for the Fed to keep policy rates unchanged in September.” Despite the fact that inflation is heading in the right direction, the still-high number indicates that the Fed is still some time away from lowering rates.
The Bloomberg Dollar Spot Index in terms of currencies was unchanged after increasing on Thursday. The longest such run since February is expected for the dollar as its weekly gains are expected to reach four. In the meantime, concerns about inflation are starting to rise as a result of the Australian dollar’s ongoing decline. Two-year rates reversed an earlier decline because they are more responsive to impending Fed actions. Early Asian trade saw an increase in the yields on Australian and New Zealand bonds. Due to a national holiday in Japan, trading in cash Treasuries in Asia and Japanese stocks will be suspended on Friday.
Some of the main moves in markets:
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