By Tom Westbrook and Chibuike Oguh
SINGAPORE / NEW YORK (Reuters) – Bonds slipped, Japanese equities jumped to a three-decade high, and other Asian equities slipped near record highs on Thursday as investors focused on U.S. stimulus prospects and expanded efforts on global recovery and growth.
US government bonds, which had climbed overnight after some assurances that the US Federal Reserve would continue to buy bonds, were sold again after CNN reported that President-elect Joe Biden is considering a stimulus package as large as $ 2 trillion . Benchmark 10-year government bond yields, which rise when prices fall, lifted 1.7 basis points in Asia. [US/]
Ten-year government interest rates have risen by more than 19 basis points this year, as investors bet on Biden’s loan-and-expenditure agenda, which is able to clear a Democratic-run Congress – and as concern creeps in when the Fed’s support may wane.
rose 0.2% and EuroSTOXX 50 futures rose 0.3%. “The first question for global markets and equities will be when will the Fed begin to decline,” said Frank Benzimra, head of Asia’s equities strategy at Societe Generale (OTC 🙂 in Hong Kong. “This is where you can get some concern … but at the moment it’s something that is premature. We’re in a context where you have growth accelerators, economic indicators are good, and in the US the likelihood of fiscal stimulus is increasing. . “
Currency markets are taking a bit more of a wait-and-see approach, as investors are short dollars and wondering if the possible tightening might limit the decline of greenbacks.[FRX/]
The dollar rose 0.2% to 104.12 yen with U.S. dividends following the CNN report, which cited a lawmaker in contact with Biden’s advisers as the source. Biden announces its financial plans on Thursday.
Traders are also eager to hear from Fed Chairman Jerome Powell on Thursday that any hint of a possible tightening could send interest rates back.
The Australian and New Zealand dollars stabilized after slipping slightly overnight, with $ 0.7733 and $ 0.7174. The euro used to have large but modest losses of $ 1.2141 and 126.3 yen.
Meanwhile, economic statistics continued to float in North Asia. China’s exports grew more than expected in December – indicating solid global demand – while machine orders rose for the second month in a row in Japan.
Chinese blue chips eased from a 13-year high on Wednesday as investors took some profits. [.SS]
Hong Kong listed shares in tech giants Alibaba (NYSE 🙂 and Tencent rose after sources told Reuters and the Wall Street Journal that plans to extend a US investment ban to the shares had been scrapped.
In Washington, the Democratic-controlled House of Representatives accused President Donald Trump for the second time. But markets have been more focused on his attacks on Chinese companies.
Trump strengthened a ban on U.S. investment in Chinese companies believed to be linked to the military by clarifying late Wednesday that U.S. investors can not own them after November 2021.
In the commodity markets, oil futures have modest losses as new increases in coronavirus cases give rise to concerns about more lockdowns and lower energy needs. futures slipped 0.1% to $ 55.91 a barrel, and futures fell by the same margin to $ 52.81 a barrel.
Gold, which pays no interest, has suffered as U.S. interest rates rose, trading 0.2% lower at $ 1,838 an ounce – well below a two-month high of $ 1,959 a week ago. [GOL/]
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