Stocks Eye Steady Open; Oil in Focus on OPEC+ Spat: Markets Wrap

(Bloomberg) -- Asian stocks look set for a steady start Monday after U.S. shares rose further on speculation the Federal Reserve has scope to continue providing substantial stimulus support. Oil is in focus amid an OPEC+ spat.

Futures were little changed in Japan and Australia and rose in Hong Kong. The S&P 500 reached a record for a seventh day Friday after a U.S. jobs report signaled the economy is gaining steam but not at a pace that would prompt the central bank to taper stimulus quickly. U.S. equity contracts were stable. U.S. stock and bond markets are closed for the July 4 Independence Day holiday.

Treasuries gained and the dollar dipped after the jobs report was seen as supporting the Fed’s accommodative stance. The greenback was little changed early Monday. Investors are also awaiting the Federal Open Market Committee minutes later this week for clues on the policy outlook.

Oil was above $75 a barrel amid an OPEC+ dispute that cast doubt on a deal that may temper prices. Saudi Arabia and the United Arab Emirates are at odds.

While the U.S. jobs report eased concerns about the Fed’s hawkish pivot last month, central banks around the world are beginning to pull back from from the emergency stimulus they deployed to fight the pandemic-driven global recession. For instance, the Reserve Bank of Australia is expected to pare back some of its stimulus at its Tuesday meeting despite lockdowns.

“Markets are priced for the continuation of a scenario that could not be better constructed,” Chris Iggo, chief investment officer for core investments at AXA Investment Managers, wrote in a note. “Investors are living with risks that are seen to be manageable while growth and the technical set-up of our financial system is rewarding capital allocated to risk.”

Elsewhere, China’s cyberspace regulator ordered app stores to remove Didi Chuxing just days after the ride-hailing giant’s U.S. initial public offering. China’s stock market open will be in focus in case the move causes jitters by again highlighting Beijing’s push to curb the influence of the nation’s largest technology companies.

Here are some events to watch this week:

• Reserve Bank of Australia policy decision Tuesday
• FOMC minutes Wednesday
• The Group of 20 finance ministers and central bankers meet in Venice on Friday
• China PPI and CPI data released on Friday

These are some of the main moves in markets:

Stocks

• S&P 500 futures were steady as of 7:46 a.m. in Tokyo. The S&P 500 rose 0.8% Friday
• Nasdaq 100 futures were little changed. The Nasdaq 100 rose 1.2%
• Nikkei 225 futures were little changed
• Australia’s S&P/ASX 200 futures were steady
• Hang Seng futures rose 0.6% earlier

Currencies

• The Japanese yen was at 111.10 per dollar
• The offshore yuan was at 6.4713 per dollar
• The Bloomberg Dollar Spot Index was little changed after sliding 0.5%
• The euro traded at $1.1861

Bonds

• The yield on 10-year Treasuries declined three basis points to 1.42% Friday
• Australia’s 10-year bond yield dipped five basis points to 1.42%

Commodities

• West Texas Intermediate crude rose 0.1% to $75.23 a barrel
• Gold was at $1,786.10 an ounce, down 0.1%

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