Asian shares rose the most in more than two weeks, heading into a week of major central bank decisions and big tech earnings releases. The yen climbed. Benchmark indexes gained in markets from Australia to Japan and Hong Kong, tracking Friday’s strong showing on Wall Street as bets grew on Federal Reserve policy easing. US futures also marched higher Monday. Chinese stocks bucked the trend amid a lack of strong growth stimulus, while an extended rally in the nation’s bond market sent the 10-year yield to a record low.
Monetary policy decisions in Japan, the US and the UK will take the center stage this week, after global markets were ravaged by the yen’s recent rally on expectations for the Bank of Japan to hike its key rate. Also in focus are earnings including Apple Inc., Amazon.com Inc and Microsoft Corp. following a stock rout sparked by an underwhelming start to the megacaps reporting season. Spurred by wagers on monetary tightening in Japan, the yen advanced against all its Group of 10 peers Monday. The long-beleaguered currency has clawed back some of its losses in recent sessions and is now on course to post its best monthly performance versus the dollar this year. The Fed is likely to signal its plans to cut in September at the conclusion of its meeting on Wednesday, according to economists surveyed by Bloomberg News, a move they say will kick off reductions each quarter through 2025. Money markets are fully pricing a September move, with a chance of two more by year-end, according to swaps data compiled by Bloomberg. Treasury 10-year yields declined two basis points to 4.18%. Just hours before the Fed’s decision, the Bank of Japan is expected to release details of plans to cut monthly bond purchases at the conclusion of its two-day policy meeting on Wednesday, while most economists also see the risk of a rate hike. The yen climbed 2.4% against the dollar last week as traders priced a more than two-thirds chance of a 10 basis point hike, causing a selloff in risk-sensitive developed and emerging market currencies and helping send the Nikkei 225 Index into a technical correction. Elsewhere in Asia, Chinese factory activity data is due this week, providing further insight into a surprise People’s Bank of China rate cut to boost a flailing economy. Australian inflation data will also be keenly awaited as investors and analysts debate whether the nation’s central bank will hike its key rate as early as next week. Oil steadied near a six-week low ahead of a key OPEC+ meeting this week, with analysts divided over whether the group will proceed with plans to boost supplies next quarter. While the coalition is seeing to restore supplies it’s withheld from the market for two years in a bid to prop up prices, sputtering economic growth in key consumer China, and new oil supplies from across the Americas, threaten to derail the plans.
Nikkei +2.44% Hang Seng +1.73% CSI -0.41% Shanghai +0.08% Shenzen -0.22%
Eur$ 1.0860 CNH 7.2623 CNY 7.2550 JPY 153.55 GBP 1.2874 CHF 0.8835 RUB 86.0660 TRY 32.9756 WTI$ 77.52 Gold 2,393 BTC 69,670 +2.4% ETH 3,353 +2.6%
S&P +0.48% Nasdaq +0.76% EuroStoxx +0.45% FTSE +0.33% Dax +0.38% SMI +0.48%
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