June 06, 2024 (MLN): Asian equities rose Thursday after a gain in US technology shares, while the dollar came under pressure amid a reassessment of bets on interest-rate cuts, as Bloomberg reported.
Indian stocks gained after Prime Minister Narendra Modi won crucial backing from two key allies in his coalition, allowing him to extend his decade in power.
Shares in Hong Kong, Japan, and Australia also climbed. Futures for US equities edged higher following the S&P 500’s 25th record close this year.
Nvidia Corp. — the poster child of the artificial-intelligence frenzy — led a rally in the “Magnificent Seven” megacaps to top $3 trillion in value.
A Bloomberg index of government bond returns rose for a fifth straight session on Wednesday, its best performance since December, as wagers started to swing toward rate cuts this year.
The greenback retreated as policy easing in Canada increased the focus on the US rate path, while European Central Bank policymakers are expected to reduce borrowing costs when they meet Thursday.
“Asian markets will be supported by the fresh record highs seen on major US indices overnight, and sentiment will also be positive as India election shock wavers,” said Charu Chanana, head of FX strategy at Saxo Markets. “Lower US yields and an upbeat risk sentiment is pushing the dollar lower.”
As investors awaited this week’s US jobs report, a private payrolls reading on Wednesday showed hiring at companies grew at the slowest pace since the start of the year.
Meantime, the services sector expanded by the most in nine months, powered by the largest monthly gain in a measure of business activity since 2021.
Treasury yields inched higher during Asian trading Thursday after falling in the previous session, with markets almost fully pricing in two Federal Reserve rate cuts in 2024.
Yields for Australian and New Zealand government bonds fell Thursday.
In Japan, the yen trimmed earlier gains after Bank of Japan policy board member Toyoaki Nakamura said it’s appropriate to maintain current policy for the time being.
The Japanese currency recovered from an overnight selloff in what has been a volatile week for the yen thanks to its role in emerging market carry trades.
Elsewhere, China’s property stocks were on track to enter a technical bear market as doubts remained on Beijing’s efforts to bolster the sector.
A Bloomberg Intelligence gauge of the nation’s developer shares extended losses from a mid-May high to about 20%.
In commodities, oil rose for a second session even as Saudi Arabia signaled concerns over the demand outlook with cuts to its crude prices.
Meanwhile, Saudi Aramco lowered prices for all of its oil to Asia next month, the first reduction since February, amid concerns over the strength of demand in its biggest market.
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Posted on: 2024-06-06T10:18:09+05:00
