Global markets: Asia’s stock market gains momentum as Singapore joins pause camp

Dovish cues helped keep non-yielding gold near one-year highs, while the euro led the currency pack as the European Central Bank remained dovish.

The Monetary Authority of Singapore (MAS) surprised many by leaving policy unchanged, saying inflation will ease sharply later this year from already ongoing tightening.

The MAS joined central banks in Canada and Australia in holding off on hikes, while the US Federal Reserve was seen nearing a pause after a soft producer prices report.

Futures still indicate a 67% chance that the Fed will raise rates in May, but then almost zero chance of further increases and perhaps 50 basis points of cuts by the end of the year.

statistics on america Retail Sales are due in the latter session and some analysts warn that the risk is in for a downside surprise, which will favor a dovish turn.

The prospect of a peak for rates helped ease worries about a recession and MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4%.

Japan’s Nikkei added 1.1% and Singapore shares added 0.5%.

Chinese blue chips firmed 0.2%, the economic outlook brightened by a surprisingly upbeat trading performance.

“The stronger-than-expected March China export gain suggests that the economic recovery is more broad-based than we expected, and we raised our 1Q Revised GDP forecast. 10.2% Q-o-Q from the prior 9.0%.

EUROSTOXX 50 futures added 0.3% and FTSE futures added 0.2%. S&P 500 futures and Nasdaq futures were flat after sharp overnight gains.

Investors are now gearing up for earnings from Citigroup Inc, Wells Fargo and JPMorgan Chase & Co, which could test the bullish mood given the recent tensions in the sector.

“We will be watching the bank earnings call to follow up on discussions regarding any adjustments to deposits, loan standards and bank funding, including more loan sales,” said analysts at NatWest Markets.

euro on a roll

With EU industrial production beating expectations and inflation proving sticky, markets are still pricing in at least 50 basis points for no cuts this year.

The divergence saw the spread between US 10-year yields and the German Bund shrink by close to 100 basis points to their smallest in two years.

A break below 100 bps would see the spread at its lowest since early 2014, when the euro hovered around $1.3600. On Friday, the single currency was steady at $1.1059, having hit a one-year top of $1.1068 overnight.

The euro was also close to a high seen in November above 146.00 yen, and the Singapore dollar hit a 10-month peak following the MAS decision.

The dollar was relatively stable at 132.57 yen on the yen, supported by the Bank of Japan’s still very easy policy stance.

All talk of a future US rate cut has boosted non-yielding gold, with the yellow metal hitting a one-year peak of $2,048.71 overnight at $2,044 an ounce, off its all-time top of $2,069.89. Not there.

Oil prices steadied after OPEC flagged risks to a fall in summer oil demand in a monthly report, highlighting rising inventories and challenges to global growth.

Brent rose 27 cents to $86.36 a barrel, while US crude gained 26 cents to $82.42.

The text of this story is published from a wire agency feed without any modification. Only the headline has been changed.