Stocks in Asia Advance After Trade Progress: Markets Wrap
Asian stocks began the week with gains after signs of progress in U.S.-China trade negotiations, though sentiment was capped as investors voiced skepticism on the accord.
Shares in Seoul and Sydney opened higher and equity futures pointed higher in Hong Kong -- Japan will be shut for a holiday. S&P 500 futures edged up after the U.S. equities gauge climbed to within 1.8% of a record on Friday. President Donald Trump said the two sides agreed to the outlines of a deal that could be signed as early as next month. The yuan was steady after Friday’s advance and Treasury futures ticked up following the pickup in yields last week.
The Singapore dollar rose after the Monetary Authority of Singapore eased monetary policy for the first time since 2016.
The U.S. won’t increase tariffs on China as scheduled this week as part of a “phase one” trade accord. Beijing will make large agricultural purchases and take steps on intellectual property, financial services and the yuan. A Chinese statement didn’t refer to a deal, saying only that “the two sides have made substantial progress,” and mentioning neither the freeze on duties nor the farm-goods commitment.
“Let’s not get carried away,” said Raoul Leering, head of international trade research at ING Bank NV. “There is a very tough journey ahead for the U.S. and Chinese negotiators to cut a deal that really has substance.”
Elsewhere, the pound retreated as European Union negotiators warned that Brexit plans from U.K. Prime Minister Boris Johnson are not yet good enough to be the basis for an agreement.
Focus now turns to earnings season that begins with big U.S. banks including JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley. Trading may be think due to the Columbus Day holiday in the U.S. as well as the closure in Tokyo.
Here are some key events coming up this week:
The International Monetary Fund and World Bank host meetings to discuss economic development and finance.
St. Louis Fed President James Bullard speaks at Bloomberg’s monetary and financial policy conference in London. Riksbank Governor Stefan Ingves also speaks there. Atlanta Fed President Raphael Bostic speaks in Atlanta. San Francisco Fed President Mary Daly gives a speech in Los Angeles.
Wednesday bring a monetary policy decision in South Korea.
U.S. retail sales are forecast to increase for a seventh straight month. Sales in the “control group” are also expected to rise. Consumer spending is carrying the weight of U.S. economic growth so the data will be monitored closely for any signs of slowing.
China releases third-quarter GDP, September industrial production and retail sales data on Friday.
Here are the main moves in markets:
Stocks
Futures on the S&P 500 Index rose 0.3% as of 8:08 a.m. in Hong Kong. The underlying gauge added 1.1% on Friday.
South Korea’s Kospi Index climbed 1.3%.
Australia’s S&P/ASX 200 Index gained 0.9%.
Currencies
The yen was at 108.36 per dollar, down 0.1%.
The offshore yuan rose 0.1% to 7.0771 per dollar.
The Bloomberg Dollar Spot Index was steady after dropping 0.4% on Friday.
The euro bought $1.1030, down 0.1%.
The British pound slid 0.5% to $1.2605.
Bonds
Futures on 10-year Treasuries added 0.1%. The yield on 10-year notes gained six basis points to 1.73% on Friday.
Australia’s 10-year yield rose seven basis points to 1.08%.
Commodities
West Texas Intermediate crude gained 0.2% to $54.90 a barrel.
Gold decreased 0.2% to $1,485.85 an ounce.
By: via @AlliesFin Serve T.ME/ALLiESFiN
