Asia Stocks to Track U.S. Rebound; Dollar Falls: Markets Wrap

Andreea Papuc and Rita Nazareth
·2 min read

(Bloomberg) -- Asia stocks are poised to bounce after U.S. equities snapped a two-day drop on a rally in companies that stand to benefit the most from an economic revival. The dollar fell, while Treasuries stabilized.

Futures pointed higher in Japan, Australia and Hong Kong. U.S. futures edged lower. Earlier, most major groups in the S&P 500 rose, with raw-material, energy and financial shares leading the charge. The Russell 2000 Index, a gauge of small caps, climbed more than 2%, outperforming major benchmarks.

Oil added to losses with an increase in U.S. crude inventories compounding concerns around a choppy global demand recovery.

Equities rebounded as traders sifted through corporate results for signs on whether an anticipated jump in profits would bring with it forecasts for stronger growth. Earlier losses were driven by concern over a flare-up in coronavirus cases around the world that could jeopardize an economic rebound, particularly with stocks trading near their all-time highs.

“Investors are trying to figure out what’s going to accelerate through the reopening based on earnings and guidance, while simultaneously keeping an eye on any reports of a coronavirus resurgence globally,” said Mike Loukas, chief executive officer at TrueMark Investments. “It’ll be a tug-of-war for direction on certain days.”

Elsewhere, the Canadian dollar advanced as the nation’s central bank said it’ll pare back asset purchases and move up its expected timeline for potential rate hikes. The European Central Banks meets Thursday and its expected to keep its policy unchanged, confirming that asset purchases under its pandemic program will run at a faster pace until June.

Here are some key events to watch this week:

European Central Bank rate decision and President Christine Lagarde briefing on Thursday.U.S. releases new home sales data Friday.

These are some of the main moves in markets:

Stocks

S&P 500 futures fell 0.2% as of 7:28 a.m. in Tokyo. The S&P 500 climbed 0.9%.Nikkei 225 futures rose 1%.Australia’s S&P/ASX 200 Index futures added 0.4%.Hong Kong’s Hang Seng Index futures rose 0.6%.

Currencies

The yen was little changed at 108.06 per dollar.The offshore yuan traded at 6.4913 per dollar.The Bloomberg Dollar Spot Index decreased 0.2%.The euro was little changed at $1.2035.

Bonds

The yield on 10-year Treasuries was steady at 1.56%.

Commodities

West Texas Intermediate crude fell 0.4% to $61.08 a barrel.Gold was at $1,794.11 an ounce.

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