Asian Stocks Mixed While Yen Strengthens After Fed: Markets Wrap – 1 Feb 2017
Stocks in Asia were mixed as investors digested a raft of earnings reports, while the yen turned higher after the Federal Reserve gave investors little fodder to change their views on the pace of U.S. interest-rate hikes.
Australian and South Korean shares edged higher, while Japan’s Topix index erased an early advance as the yen resumed gains. Futures on the S&P 500 slipped after the gauge eked out a small increase on Wednesday. Oil slumped while gold advanced. The Aussie extended gains after trade data topped estimates. China markets remain closed for the final day of Lunar New Year holidays that started last Friday.
The Fed reiterated its intention to lift rates gradually as the labor market tightens, acknowledging rising confidence among U.S. consumers and businesses. Investors will now be looking toward Friday’s jobs report after the uncertainty created during Donald Trump’s first two weeks in office brought equity indexes down from record highs.
“The Trump administration’s protectionist rhetoric and divisive political approach have raised concerns the anticipated fiscal stimulus measures could be derailed,” said Elias Haddad, Sydney-based senior currency strategist at Commonwealth Bank of Australia. “The dollar will continue to trade on the defensive in the near term.”
Earnings are coming thick and fast with results from Siemens AG to Volvo AG and Facebook Inc. boosting optimism for corporate forecasts. Later Thursday in Japan, heavyweights including Mazda Motor Corp. and Sony Corp. are due to release profit reports. Royal Dutch Shell Plc results are scheduled during European hours, while investors in the U.S. will be scrutinizing Amazon.com Inc.’s earnings.
Here are the main market moves:
- Futures on the S&P 500 lost 0.2 percent as of 9:54 a.m. in Tokyo, after the underlying gauge rose less than one point to close at 2,279.42 on Wednesday. That halted a four-day slide that was the longest since the November election.
- The MSCI Asia Pacific Index climbed 0.4 percent. Japan’s Topix index fell 0.4 percent and Australia’s S&P/ASX 200 Index gained 0.2 percent. South Korea’s Kospi added 0.4 percent.
- The Bloomberg Dollar Spot Index lost 0.2 percent, poised for the lowest closing level since November. The gauge had gained as much as 0.4 percent after data Wednesday from the ADP Research Institute showed private payrolls climbed by 246,000, compared with the 168,000 median projection of analysts surveyed by Bloomberg.
- The yen climbed 0.3 percent to 112.92 per dollar, after dropping Wednesday for the first time in three days.
- The Aussie rose 0.6 percent to 76.29 U.S. cents as the government’s trade surplus for December beat forecasts.
- The yield on the 10-year U.S. Treasury note was flat after adding two basis points to 2.47 percent on Wednesday. Australian bond yields climbed four basis points to 2.77 percent.
Source: Bloomberg