Global Stocks Push Higher; Dollar Extends Decline: Markets Wrap

Global Stocks Push Higher; Dollar Extends Decline: Markets Wrap
Adam Haigh

(Bloomberg) -- Stocks and equity futures pushed higher on Wednesday as investors weighed the potential for a stimulus-fueled economic rebound against the chances of destabilizing inflation. The dollar edged lower.

Equities in Hong Kong climbed, a move led by Tencent Holdings Ltd. amid positive sentiment toward reported changes at its gaming business. S&P 500 futures advanced after the benchmark halted a six-day winning streak when it edged back from an all-time high. Treasuries were steady with the yield on benchmark notes trading around 1.16%. Earlier, the Nasdaq 100 Index eked out a gain, while small caps notched the longest rally since December 2019.

Elsewhere, oil edged lower after seven sessions of gains. Bitcoin pulled back from a record it reached after Tesla Inc. bought $1.5 billion of the cryptocurrency.

Global shares are testing another record high as investors cheer advancing vaccination efforts, rising stimulus prospects and a slowdown in coronavirus infections across the globe. Still, a ramp up in inflation expectations has also highlighted a debate about whether the so-called reflation trade in bonds could create jitters for global equities trading near record highs.

“A pullback here could give tactical opportunities to those who were looking to get involved,” Mona Mahajan, investment strategist at Allianz Global Investors, said on Bloomberg TV. “It seems like right now the story is just getting started, and the momentum is building behind it, and that story includes the reopening, vaccines, the downward trend now in some of the virus cases we’ve been seeing, supported by the stimulus talks and the Fed still on the side lines.”

Meantime, Twitter Inc. rose in extended trading after sales topped estimates. Cisco Systems Inc. fell post market as it reported a big decline in enterprise sales.

Here are some key events coming up:

Earnings season continues with companies including Societe Generale and L’Oreal.EIA crude oil inventory report comes Wednesday.Sweden will set monetary policy on Wednesday.Federal Reserve Chair Jerome Powell will speak on a webinar Wednesday.The U.S. consumer price index comes Wednesday.Lunar New Year public holidays begin in nations across Asia, with China breaking for a week.Bank of Russia’s policy decision comes Friday.

These are the main moves in markets:

Stocks

S&P 500 futures added 0.4% as of 12:53 p.m. in Tokyo. The index fell 0.1% on Tuesday.Hong Kong’s Hang Seng rose 1.9%.Japan’s Topix index gained 0.3%.South Korea’s Kospi was little changed.Australia’s S&P/ASX 200 Index gained 0.6%.Euro Stoxx 50 futures added 0.5%.

Currencies

The Bloomberg Dollar Spot Index dipped 0.1%.The euro bought $1.2128, up 0.1%.The offshore yuan was at 6.4248 per dollar.The yen traded at 104.54 per dollar.

Bonds

The yield on 10-year Treasuries remained at 1.16%.

Commodities

West Texas Intermediate crude slipped 0.2% to $58.27 a barrel.Gold was at $1,845.12 an ounce, up 0.4%.

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