Asian stocks slip at end of best week since January

Adam Haigh, Bloomberg

Asian stocks were mostly lower on Friday, while heading for their biggest weekly gain since January as investors embraced the decisive shift by central banks back to stimulus mode. The S&P 500 Index closed at a record high overnight.

Japanese, South Korean and Australian shares dipped, while Hong Kong’s benchmark fluctuated and Shanghai shares rose. European and U.S. futures pared losses. Oil dipped after renewed tensions between the US and Iran sent crude soaring.

The dollar steadied after slumping in the wake of the Federal Reserve’s signal for lower interest rates, while gold traded above $1,400 an ounce for the first time since 2013.

In Japan, 10-year yields dipped after the Bank of Japan left its bond-buying operations unchanged at a regular operation Friday. While they are near the bottom of officials’ target range - at negative 0.18% against a theoretical floor of minus 0.2% - BOJ Governor Haruhiko Kuroda said Thursday that zone should be thought of flexibly.

The yen hit its high of the session Friday after the New York Times reported that President Donald Trump had approved strikes against Iran in retaliation for downing a US drone, but then called off the operation.

Central banks in the US, Europe and Australia were among those signalling a readiness to do more to support growth this week. That’s helped fueled gains for equities while putting increased pressure on sovereign bond yields as the trade war rumbles on.

Next week, the trade issue is back up: U.S. President Donald Trump and Chinese President Xi Jinping are set to meet during the Group of 20 summit in Japan next week.

Gains for stocks have “been built on the potential for monetary policy support from the Federal Reserve on one side, and the easing of trade tensions on the other,” Alex Dryden, global market strategist at JPMorgan Asset Management, told Bloomberg TV. “That is not the best basis for building an equity market rally in a sustainable manner.”

After firming all week, rand slightly weaker in wake of SONA

After firming 3% against the dollar during the week, the rand was trading slightly weaker against the dollar on Friday morning in the wake of President Cyril Ramaphosa's State of the Nation address.

The local currency opened trade at R14.33 to the greenback and was changing hands at R14.38 at 08:30, down 0.3%.