March 29, 2024 (MLN): Shares in Asia rose following gains on Wall Street, with focus shifting to key US consumer price data due later Friday, as Bloomberg reported.
Benchmarks in Japan, South Korea and mainland China all edged higher, after US stocks wrapped up a stellar quarter on a positive note.
All eyes are on the upcoming release of the Federal Reserve’s preferred consumer price reading for fresh clues about its policy outlook.
Several Asian markets, including Australia, Hong Kong and Singapore, are closed Friday for a public holiday.
The gains in the region came after traders sent the S&P 500 to its 22nd record this year on the back of data showing the US economy remained healthy.
A $4 trillion surge in US equity values in just three months has startled doomsayers, while leaving a host of strategists scrambling to update their 2024 targets.
“Domestic events are driving the gains in China, Japan and South Korea with investor sentiment underpinned by the overnight gains in the US market,” said Seo Sang-Young, a market strategist at Mirae Asset Securities.
End-of-quarter portfolio rebalancing also seems to be in play, Seo added.
Traders are on alert for potential swings in Japan’s currency after officials stepped up warnings this week to stem its slide.
While the yen has since strengthened a little against the greenback, it remains close to levels not seen in decades.
Some recent weakening moves in the yen were speculative and not reflecting fundamentals, Japanese Finance Minister Shunichi Suzuki said Friday, adding there is no specific defense line regarding the exchange rate level.
There is a growing sense of wariness of intervention, said Taishi Fujita, associate in the global markets division for the Americas at MUFG Bank.
“Even if you build a position selling the yen during a strong phase, you are likely to drop the position as it approaches 152.” He pointed out that the market may continue to hover in the low 151-yen per dollar range.
Latest data showed that consumer price growth in Tokyo moderated while staying well above the central bank’s inflation target. It may keep authorities on track to consider more rate increases after they hiked earlier this month for the first time since 2007.
On China’s corporate front, one of the nation’s biggest property firms delayed its earnings report while another posted a historic profit decline.
Country Garden Holdings Co. announced late Thursday it will miss a deadline for reporting annual results, saying it needs more information. Developer China Vanke Co. said net profit tumbled 46% last year.
No Rush
Swaps traders on Thursday slightly trimmed wagers that the Fed would cut rates as soon as June following Fed Governor Christopher Waller’s comments on Wednesday that there was no rush to lower interest rates.
Two-year Treasury yields climbed five basis points to 4.62% in a shortened session ahead of the holiday, while the dollar extended its quarterly advance. Trading of cash Treasuries in Asia is closed due to the holiday.
The US government’s two main measures of activity, gross domestic product and consumer spending, posted strong advances at the end of last year.
Consumer sentiment rose markedly toward the end of March, supported partly by the strong stock-market gains.
In addition to the release of the PCE price index, the Fed’s preferred inflation gauge, traders will also closely monitor a speech by Fed Chairman Jerome Powell later Friday.
Elsewhere, gold hit a fresh all-time high, extending a weeks-long rally fueled by bets on Fed rate cuts and deepening geopolitical tensions.
Oil scored a 16% quarterly gain in the latest sign that export curbs by OPEC and its allies are reining in global supplies.
Bitcoin eased Friday after climbing to $71,555 in the previous session. Meantime, FTX co-founder Sam Bankman-Fried was sentenced to 25 years in prison for stealing billions of dollars from customers.
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Posted on: 2024-03-29T09:12:22+05:00
