Most Asian stocks rose on Tuesday, along with US equity futures, amid speculation the Biden administration may end some of the Trump-era tariffs on Chinese consumer goods. Treasures collapsed after they were reopened from vacation.
Japan and South Korea led a modest regional climb in shares, while the S&P 500 and Nasdaq 100 contracts gained about 0.5% from Friday’s close. US markets were closed on Monday due to the Independence Day holiday.
The US may announce the withdrawal of some tariffs as soon as this week to counter high inflation. Officials may also disclose investigations into industrial subsidies, which could lead to higher tariffs in strategic sectors such as technology.
Commodity-linked currencies posted gains overnight, tariffs reported, the yen fell and the dollar fluctuated. At Treasuries, the 10-year yield jumped over 2.95%, extending the global bond dip that began in Europe on Monday.
Apart from developments related to China, traders are also watching Australia’s interest rate decision. The central bank – to hike rates by more than 80 this year – is expected to implement back-to-back half percentage point rate hikes for the first time.
Speculation has intensified that President Joe Biden may ease some of the Trump-era tariffs on $300 billion in Chinese imports. Policymakers are under pressure to tackle inflation, which has forced interest rates to rise this year, halted economic expansion and contributed to huge losses in equities and fixed income.
“Markets are likely to react positively to the knee-jerk reaction as at this point we are hungry for any sign of positive news,” said Charu Chanana, Senior Market Strategist, Saxo Capital Markets Pte. “But we don’t see the move impacting global growth and inflation dynamics in a significant way.”
Elsewhere, Brent crude traded near $113 a barrel. Bitcoin retested the $20,000 level.
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What to watch this week:
- Australia Rate Decision, Tuesday
- PMI for euro area, including China, India, among others, Tuesday
- US Factory Orders, Durable Goods, Tuesday
- FOMC Minutes, US PMI, ISM Services, JOLTS Job Openings, Wednesday
- EIA Crude Oil Inventory Report, Thursday
- Fed Governor Christopher Waller, St. Louis Fed Chairman James Bullard, to speak on Thursday
- ECB account of its June policy meeting, Thursday
- US employment report for June, Friday
Some of the main moves in the markets:
shares
- S&P 500 futures were up 0.5% as of 9:39 am in Tokyo. S&P 500 up 1.1% on Friday
- Nasdaq 100 futures rose 0.7%. Nasdaq 100 up 0.7% on Friday
- Japan’s Topix Index rose 0.6%
- Australia’s S&P/ASX 200 was stable
- South Korea’s Kospi index rose 1.4%
currencies
- The Bloomberg Dollar Spot Index was stable
- Euro $1.0430 . was on
- The Japanese yen was down 0.2% at 135.94 per dollar
- The offshore yuan was at 6.6961 per dollar
bond
- Australia’s 10-year yield rose five basis points to 3.61%
Goods
- West Texas Intermediate crude was up 1.9% at $110.50 a barrel
- Gold was down 0.5% at $1,807.05 an ounce
This story has been published without modification in text from a wire agency feed.