(Bloomberg) — Asian stocks rose after a tech rally early in the week that included key inflation data and bank earnings boosted gains on Wall Street.
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Stocks rose in Australia and South Korea, and Japanese stocks also rose after a holiday break. Previously released data showed that inflation in Tokyo slowed for a second time in December, a reading broadly consistent with the Bank of Japan's view that import-related price pressures are easing.
Futures also pointed to profits in Hong Kong. U.S. stock contracts held steady after the Nasdaq 100 outperformed on Monday, with Nvidia Corp. rose sharply following the announcement of new artificial intelligence products for PCs. Boeing Co. sank as its 737 Max 9 model was temporarily grounded by authorities.
Treasury yields fell slightly in early trading in Asia and the dollar stabilized. Bitcoin surged as U.S. regulators appear poised to approve exchange-traded funds that invest directly in the digital asset for the first time.
In addition to key U.S. inflation data due later this week, investors will also be watching whether China will increase its monetary stimulus to support its struggling economy. A senior Chinese central bank official noted that authorities may lower the amount of money banks must set aside in reserves to boost lending, even after the central bank provided a huge amount of liquidity through other instruments in recent weeks.
“The valuation-driven year-end rally dragged potential gains from 2024 to 2023, making forecasting for this year difficult – especially as data becomes increasingly mixed and futures markets show that Fed rate cuts are already priced in,” said Robert Teeter, managing director of Silvercrest Asset Management.
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Inflation focus
Federal Reserve Governor Michelle Bowman said that if interest rates remain at current levels, inflation could fall toward the central bank's 2 percent target and offered potential support for lowering borrowing costs if price pressures should subside.
“If inflation continues to fall closer to our 2% target over time, it will be appropriate at some point to begin cutting our key interest rate to prevent policy from becoming too restrictive,” Bowman said in prepared remarks the South Carolina Bankers Association Columbia.
Back in the corporate world, shares of Samsung Electronics rose amid the broader tech rally, even as the company reported a sixth consecutive decline in operating profit. Sony Group Corp. plans to terminate the merger agreement of its Indian unit with Zee Entertainment Enterprises Ltd. to terminate, people familiar with the matter said. Canceling the deal would mean two years of drama and delay in the creation of a $10 billion media giant.
Elsewhere, oil fell sharply, sparked by signs of a weaker physical market, including a sharp price cut by OPEC+ leader Saudi Arabia.
Company highlights:
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` Moller – Maersk A/S and Hapag-Lloyd AG denied any agreement with Yemen's Houthi rebels to allow the safe movement of ships through the Red Sea
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Moderna Inc.'s 2023 product sales slightly beat analysts' estimates as the company grabbed a larger U.S. market share for Covid vaccinations, even as the biotech giant reiterated its optimistic outlook for the year ahead
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Johnson & Johnson will pay $2 billion in cash to acquire Ambrx Biopharma Inc., a developer of sought-after drugs that target tumors with lethal drugs
Important events this week:
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China's total financing, money supply, new yuan loans, Tuesday
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Unemployment in the Eurozone, Tuesday
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Germany's industrial production, Tuesday
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US trading, Tuesday
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US wholesale inventories, Wednesday
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The World Economic Forum's global risk report will be released on Wednesday
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New York Fed President John Williams speaks on Wednesday
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US CPI, initial jobless claims, Thursday
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China CPI, PPI, trade, Friday
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British industrial production, Friday
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US PPI, Friday
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Some of the largest U.S. banks report fourth-quarter results on Friday
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Minneapolis Fed President Neel Kashkari speaks Friday
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ECB chief economist Philip Lane speaks on Friday
Some of the key moves in the markets:
Shares
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S&P 500 futures were little changed at 9:13 a.m. Tokyo time. The S&P 500 rose 1.4%
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Nasdaq 100 futures were little changed. The Nasdaq 100 rose 2.1%
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Japan's Topix index rose 1%
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Australia's S&P/ASX 200 index rose 1.1%
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Hong Kong's Hang Seng futures rose 0.8%
Currencies
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The Bloomberg Dollar Spot Index was little changed
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The euro was little changed at $1.0956
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The Japanese yen rose 0.2% to 144.01 per dollar
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The offshore yuan was little changed at 7.1613 per dollar
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The Australian dollar was little changed at $0.6722
Cryptocurrencies
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Bitcoin was little changed at $47,101.76
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Ether remained little changed at $2,337.44
Tie up
raw materials
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West Texas Intermediate crude oil barely changed
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Spot gold rose 0.2% to $2,032.78 an ounce
This story was produced with support from Bloomberg Automation.
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