Asia Stocks Set to Rise After U.S. High; Oil Drops: Markets Wrap

Asia Stocks Set to Rise After U.S. High; Oil Drops: Markets Wrap
Andreea Papuc and Rita Nazareth
·4 min read

(Bloomberg) -- Asian stocks look set to climb Tuesday after U.S. equities rallied to a record on solid economic data that added to evidence of a strengthening recovery. The dollar and crude oil held losses.

Futures pointed higher in Japan, while Australian and Chinese markets will reopen after holidays. Hong Kong remains closed. S&P 500 futures edged higher after the gauge reached an all-time high with most of its major groups advancing. Megacap U.S. internet and technology stocks rallied amid optimism about the strong pace of economic growth. Facebook Inc. surged to a new peak as the Nasdaq 100 jumped 2%.

Oil held onto most of its decline as growing delays in Europe’s reopening and looming Iranian supply dampened hopes for a swift decline in global inventories.

U.S. data continued to highlight an economic pickup as more Americans are vaccinated against the coronavirus, restrictions are rolled back and fiscal relief takes hold. U.S. service providers had the fastest growth on record in March as orders jumped to new highs. A report last week showed employers in the world’s largest economy added the most jobs in seven months.

At the same time, investors are weighing the impact of the Biden administration’s proposed increase to the corporate tax rate to help fund its spending plan.

“The reopening trade is back with good reason,” Kim Forrest, Bokeh Capital Partners founder and chief investment officer, said on Bloomberg TV. “Do I think that some of that rebound might be taken off of the table because of taxes in America? Maybe near the end of that growth spurt, certainly not at the beginning -- which I think that’s where we are here.”

A ruling that opens the door to passing multiple additional bills this year without any Republican support may bolster the prospects for President Joe Biden’s economic agenda.

Treasury Secretary Janet Yellen reiterated her view that the $1.9 trillion U.S. pandemic-relief bill signed last month won’t stoke inflationary pressures, and suggested that low interest rates will continue to prevail in coming years. She also outlined the case for a harmonized corporate tax rate across the world’s major economies in her first major speech on international economic policy.

Traders are keeping an eye virus curbs across Europe as the region continues to grapple with rising infections that threaten to delay economic reopening there.

Elsewhere, Credit Suisse Group AG started unloading stocks tied to the Archegos Capital blowup more than a week after some rivals dumped their shares and skirted losses. The blocks involve ViacomCBS Inc., Vipshop Holdings Ltd. and Farfetch Ltd. The three companies fell in post-market trading, as did U.S.-listed shares of Credit Suisse.

Some key events to watch this week:

The 2021 Spring Meetings of the International Monetary Fund and the World Bank Group take place virtually. U.S. Treasury Secretary Janet Yellen is among the participants of a climate discussion on Tuesday. Federal Reserve Chairman Jerome Powell takes part in a panel about the global economy on Thursday.The Fed publishes minutes from its March meeting on Wednesday.Japan releases its balance of payments numbers Thursday.China’s consumer and producer prices data are due Friday.

These are some of the main moves in markets:

Stocks

S&P 500 futures rose 0.1% as of 8:10 a.m. in Tokyo. The S&P 500 rose 1.4%. Nasdaq 100 futures gained 0.2%.Nikkei 225 futures rose 0.6%.

Currencies

The yen traded at 110.20 per dollar.The offshore yuan was at 6.5580 per dollar.The Bloomberg Dollar Spot Index was little changed after declining 0.3%.The euro was at $1.1815.

Bonds

The yield on 10-year Treasuries fell two basis points to 1.70%.Australia’s 10-year bond yield was steady at 1.84%.

Commodities

West Texas Intermediate crude rose 0.7% to $59.05 a barrel. It tumbled 4.6% in the previous session.Gold was little changed at $1,728.13 an ounce.

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