Asian stocks are set to open higher Tuesday after technology shares led gains in the U.S. as investors put inflation worries on the backburner for now. Bitcoin surged after a weekend rout.
Futures pointed higher in Japan, Australia and Hong Kong. The S&P 500 rose and the Nasdaq 100 outperformed amid a rally in technology giants such as Apple Inc., Amazon.com Inc. and Tesla Inc. The world’s largest cryptocurrency soared after plunging as much as 18% on Sunday. Benchmark 10-year Treasury yields and the dollar retreated.
Oil jumped by the most in a month after Iran said that gaps remain in negotiations aimed at reaching a deal to end U.S. sanctions on its crude, which would add to supply in the market.
Federal Reserve officials reiterated that they expect spikes in inflation to be transitory. Federal Reserve Governor Lael Brainard, Atlanta Fed President Raphael Bostic and St. Louis’s James Bullard said they wouldn’t be surprised to see bottlenecks and supply shortages push prices up in coming months as the pandemic recedes and pent-up customer demand is unleashed — but much of those price gains should prove temporary.
While market-based measures of inflation expectations have dipped, investors remain cautious about price pressures as well as Covid-19 spikes, for instance in Asia.
“Inflation is a key focus for investors, meaning uncertainty over what happens to interest rates,” Chris Iggo, chief investment officer of core investments at AXA Investment Managers, wrote in a note. “Yield curves have stabilized, but it is not clear that renewed inflation concerns automatically mean steeper curves.”
Here are some events this week:
- Bank of Indonesia rate decision Tuesday, Reserve Bank of New Zealand policy decision Wednesday, Bank of Korea rate decision Thursday.
- CEOs of the largest U.S. banks, including JPMorgan and Goldman Sachs, will testify before lawmakers in the Senate Banking and House Financial Services committees Wednesday.
- U.S. initial jobless claims, GDP, durable goods, pending home sales on Thursday.
These are some of the main moves in markets:
- The S&P 500 rose 1%
- The Nasdaq 100 added 1.7%
- Nikkei 225 futures climbed 0.5%
- Australia’s S&P/ASX 200 index futures gained 0.3%
- Hang Seng index futures rose 0.3%
- The Japanese yen was at 108.76 per dollar
- The offshore yuan traded at 6.4096 per dollar
- The Bloomberg Dollar Spot Index fell 0.2%
- The euro was at $1.2216
- The yield on 10-year Treasuries declined two basis points to 1.60%
- West Texas Intermediate crude rose 3.9% to $66.05 a barrel
- Gold was at $1,881.02 an ounce
— With assistance by Rita Nazareth, Vildana Hajric, and Katherine Greifeld
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