News
Asian stocks wobble after rally, Wall Street reopens in focus
By Stella Qiu
SYDNEY (Reuters) – Asian shares maintained a mixed tone on Tuesday after rallying in the previous session, as growing bets on an imminent European rate cut helped risk appetite ahead of some key inflation data .
A number of European Central Bank officials said overnight that the ECB has room to cut interest rates as inflation slows, underlining expectations for a rate cut on June 6. With the debate now shifting to follow-on moves, markets have fully priced in two rate cuts by October this year. year.
That helped Wall Street stock futures firm ahead of U.S. markets reopening after a holiday. S&P 500 futures rose 0.1% and Nasdaq futures gained 0.2% ahead of a meeting of Federal Reserve speakers later in the day for the latest guidance on the rate outlook.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4%, thanks to a 0.7% gain in Hong Kong’s Hang Seng index, after gaining 0.9% on Monday.
Japan’s Nikkei, on the other hand, fell 0.3%, reversing part of the previous day’s 0.7% advance.
“We’re entering the northern hemisphere summer season. Traditionally, this is a time when markets tend to go into this drift mode. We’re already through earnings season,” said Tony Sycamore, analyst at IG.
“To find a driver you need something out of the ordinary and instead we usually see markets go up and I think that’s what we’re seeing right now.”
Chinese blue chips lost 0.1%, after rising 1% the previous day, as technology stocks rose on Beijing’s further commitment to invest in its semiconductor industry. [.SS]
This week’s big risk-on events won’t come until Friday, when US numbers on core personal consumption expenditures (PCE) – the Federal Reserve’s preferred measure of inflation – and eurozone inflation data will set the tone. of the negotiations.
In foreign exchange markets, the dollar was at a disadvantage for the third consecutive session, with traders positioned for the release of the PCE. The median forecast points to an increase of 0.3% in April, maintaining the annual pace at 2.8%, with downward risks.
The Japanese yen held steady at 156.80 per dollar, only slightly stronger than the key level of 157. However, it continued to weaken against a number of high-yielding currencies, with the New Zealand dollar hitting a new 17-year high of 96.56 yen on Tuesday. [FRX/]
Thanks to strong carry demand, the kiwi reached a two-and-a-half-month high of $0.6155.
The Treasury spot market returned from a slow holiday after falling last week.
Two-year yields fell 1 basis point to 4.9396%, having risen 13 basis points the previous week, while the 10-year yield held at 4.4649%, after rising 5 basis points the previous week.
The story continues
Oil prices remained largely stable on Tuesday. Brent futures rose 0.1% to $83.19 a barrel. [O/R]
Gold prices rose for a third day, rising 0.1% to $2,354.23 per ounce.
(Reporting by Stella Qiu; Editing by Jacqueline Wong)