Asia Stocks Set for Mixed Start; Bonds Climb: Markets Wrap

(Bloomberg) -- Asian stocks were poised for a mixed start after Federal Reserve meeting minutes confirmed the central bank’s dovish tilt on policy this year. Treasuries gained and U.S. equities rose.

Futures were little changed in Hong Kong, and signaled small losses in Japan and Australia. The S&P 500 Index advanced as unexpectedly soft inflation boosted the Fed’s wait-and-see approach to rate hikes. Sovereign bonds climbed as central bankers detailed weakness in the economic outlook, pushing yields on German Bunds further below zero.

Global equities are showing signs of fatigue after a strong start to the year. European Central Bank President Mario Draghi reiterated warnings that global risks continue to batter the region’s economy as the ECB signaled no rate hikes for the rest of 2019. Despite a U.S. economy that is forecast to grow above trend with low unemployment, Fed minutes showed concern about external drags such as slowing European growth, the potential of a disruptive Brexit and the ongoing trade war.

“I think this confirms the message that we got from the March meeting,” said James McCann, senior economist at Aberdeen Standard Investments. “This is a Fed that’s pretty happy to just sit on its hands for the time being and stay on hold and see how some of these cross currents play out.”

Elsewhere, the pound was steady as European Union leaders met in Brussels to hash out the terms of a Brexit delay. Oil rebounded to a five-month high after EIA data showed the biggest drop in gasoline stockpiles since 2017.

Here are some notable events coming up:

• U.S. banks begin reporting first-quarter earnings, led by JPMorgan and Wells Fargo.
• China inflation data due Thursday may show a pick up in February. New lending and money-supply data will also arrive as early as Thursday.

These are the main moves in markets:

Stocks

• Futures on Japan’s Nikkei 225 slipped 0.2 percent in Singapore.
• Hang Seng futures were little changed.
• Futures on Australia’s S&P/ASX 200 Index fell 0.2 percent.
• The S&P 500 Index gained 0.4 percent.

Currencies

• The yen was at 110.97 per dollar.
• The offshore yuan held at 6.7184 per dollar.
• The euro bought $1.1276.
• The British pound was steady at $1.3088.
• The Bloomberg Dollar Spot Index fell 0.2 percent Wednesday.

Bonds

• The yield on 10-year Treasuries fell three basis points to 2.47 percent.

Commodities

• West Texas Intermediate crude increased 0.8 percent to $64.47 a barrel.
• Gold fell 0.4 percent $1,302.86 an ounce.

©2019 Bloomberg L.P.