Stocks in Asia are set to open steady on Thursday as central banks in their quest to rein in inflation raise flamboyant messages and JPMorgan Chase & Co.’s Jamie Dimon sounded alarm bells on the economy. Treasury yields and the dollar advanced.
There was little change in futures in Japan, where stocks may find some support from the sinking yen. They fell in Australia and Hong Kong. US contracts held steady in early Asian trade after shares fell on Wall Street. The data showed exceptionally high job openings, along with an unexpected uptick in US manufacturing activity, raising concerns that the Federal Reserve would need to impose more restrictions to make up for slowing price gains.
The yield on the 10-year Treasury rose higher as traders bet on the way to hike rates and the Fed began the process of shrinking its balance sheet. Oil was hovering around $115 a barrel ahead of the OPEC+ meeting to discuss supply policy.
Dimon warned investors to be prepared for an economic “storm.” In contrast, JPMorgan’s bullish strategist Marko Kolanovic expects stocks to rally by the end of the year, underscoring the growing debate that markets are reeling from challenges ranging from tightening monetary policy to the war in Ukraine. ,
Strong US data landed in a market where investors are scrambling about whether the Fed’s tough policies will prompt a recession. The Bank of Canada raised its overnight rate by half a percentage point as expected, and warned it could act “more strongly” if needed to tackle inflation.
A group of Fed officials have been left behind to maintain rate hikes to counter price pressure. Mary Daly of the San Francisco Fed and her more enthusiastic aide James Bullard of St. Louis both backed plans to raise rates by 50 basis points this month, while Thomas Barkin of Richmond said it was “to strengthen policy”. correct understanding”.
Greg Boutle, US Head of Equity and Derivatives Strategy at BNP Paribas, said on Bloomberg TV, “We now find ourselves in a bit too much no man’s land. We are in such a bear market environment, yet we haven’t. has done.” So far the macro data has seen bearishness. So we still think there is a way for the US economy to soften rather than land hard.”
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