Asian Stocks Advance Most in a Week; Dollar Slips: Markets Wrap

(Bloomberg) -- Asian stocks rose the most in a week on Tuesday after a drop in coronavirus hospitalizations in some U.S. states, even as global cases topped 20 million. The dollar slipped.

Japanese and Hong Kong equities rose more than 2%. Shares advanced in Australia and South Korea. S&P 500 futures climbed, putting the benchmark on course to approach its all-time high from February. The tech-heavy Nasdaq 100 lost ground. Yields on 10-year Treasuries hovered near two-week highs.

Markets are taking some comfort after New York, California and Texas reported falling hospitalizations. Chinese data underscoring a recovery in the nation’s economy also underpinned sentiment. Still, while it took six months after the virus first surfaced in China to reach 10 million infections, the spread has steadily accelerated, doubling in six weeks.

“The nature of the activity rebound will depend on the path of the outbreak, delivery of policy response and potential changes to consumer and corporate behaviors,” strategists at BlackRock Investment Institute, led by Global Chief Investment Strategist Mike Pyle, said in a note. “Success will not just be about restarting the economy and containing the virus. We are moderately pro-risk.”

Investors are also assessing simmering tensions between the U.S. and China, as well as progress in talks between Democrats and Republicans still negotiating a broader additional virus relief package. China said it will sanction 11 Americans in retaliation for similar measures imposed by the U.S. on Friday, but the list doesn’t include any members of the Trump administration.

Elsewhere, the Chinese yuan gained in offshore markets as liquidity tightened ahead of the central bank selling bills in Hong Kong this week. Oil traded around $42 a barrel after Saudi Aramco said demand will continue to improve and traders bet on more U.S. stimulus. The risk-on sentiment weighed on gold.

Here are some key events coming up:

• Earnings include SoftBank, Telstra, Deutsche Telekom, Carlsberg, Tencent and JD.com.
• New Zealand’s policy decision is due on Wednesday.
• China releases a slew of data for July on Friday, including industrial production and retail sales.
• U.S. retail sales are expected Friday, with a smaller increase forecast for July than in the prior two months.

These are the main moves in markets:

Stocks

• S&P 500 futures rose 0.3% as of 1:35 p.m. in Tokyo. The S&P 500 Index increased 0.3%.
• Topix index rose 2.5%.
• Australia’s S&P/ASX 200 Index index rose 0.6%.
• South Korea’s Kospi index climbed 1.5%.
• Hong Kong’s Hang Seng Index rose 2.4%.
• Euro Stoxx 50 futures climbed 1%.
• MSCI Asia Pacific Index rose 1.4%.

Currencies

• The yen dipped to 106.07 per dollar.
• The offshore yuan rose 0.2% to 6.9461 per dollar.
• The Bloomberg Dollar Spot Index fell 0.1%.
• The euro traded at $1.1752, up 0.1%.

Bonds

• The yield on 10-year Treasuries was at 0.58%.
• Australia’s 10-year bond yield rose one basis point to 0.87%.

Commodities

• West Texas Intermediate crude rose 0.8% to $42.26 a barrel.
• Gold traded at $2,016.95 an ounce, down 0.5%.

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