Most Asian equities rose Tuesday after U.S. stocks closed around record highs as investors eye the start of the corporate earnings season and relatively smooth sales of government debt.
Shares advanced in Hong Kong and Japan, but fluctuated in China as export growth missed forecasts in March. U.S. equity futures were steady following a slight pullback in the S&P 500 Index after three straight weeks of gains. Tech shares weakened, led by Intel Corp. as Nvidia Corp. homed in on its microprocessors market.
U.S. bond yields and the dollar ticked up. The Treasury’s sales of three- and 10-year notes attracted decent demand, and the focus turns to Tuesday’s 30-year auction.
A positive outlook for U.S. growth should help corporate earnings, though stocks look precarious around record highs given spikes in Covid-19 cases and troubled vaccine rollouts in parts of the world. While concerns about higher borrowing costs have eased on central banks’ assurances that interest rates will remain low, investors are still alert to the risk of rebounding inflation. U.S. consumer prices data are due Tuesday.
“It’s not too late to focus on the relationary trade,” Suresh Tantia, senior investment strategist at Credit Suisse, told Bloomberg TV. “The sectors which are more exposed to cyclical recovery and inflation will do better than growth stocks in the next three- to six months.”
Elsewhere, Treasury Secretary Janet Yellen will decline to name China as a currency manipulator in her first semiannual foreign-exchange report, according to people familiar with the matter, allowing the U.S. to sidestep a fresh clash with Beijing.
Oil rose above $60 a barrel. Bitcoin climbed back above $60,000 ahead of a listing by the largest U.S. cryptocurrency exchange.
Some key events to watch this week:
- Banks and financial firms begin reporting first-quarter earnings, including JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp., Morgan Stanley, Goldman Sachs Group Inc.
- The U.S. releases inflation data Tuesday.
- Economic Club of Washington hosts Fed Chair Jerome Powell for a moderated Q&A on Wednesday.
- U.S. Federal Reserve releases Beige Book on Wednesday.
- U.S. data including initial jobless claims, industrial production and retail sales come Thursday.
- China economic growth, industrial production and retail sales figures are on Friday.
These are some of the main moves in financial markets:
- S&P 500 futures were little changed as of 12:42 p.m. in Tokyo. The index was steady Monday.
- Japan’s Topix Index rose 0.7%.
- China’s Shanghai Composite Index was flat.
- Hong Kong’s Hang Seng Index was up 1%.
- South Korea’s Kospi Index climbed 1.1%.
- Australia’s S&P/ASX 200 Index was flat.
- Euro Stoxx 50 futures added 0.2%.
- The Bloomberg Dollar Spot Index rose 0.1%.
- The yen was down 0.3% at 109.67 per dollar.
- The euro slipped 0.1% to $1.1894.
- The offshore yuan was at 6.5524 per dollar.
- The yield on 10-year Treasuries edged up two basis points to 1.69%.
- Australia’s 10-year yield was three basis points higher at 1.81%.
- West Texas Intermediate crude was up 0.6% at $60.03 a barrel.
- Gold was at $1,732.93 an ounce.
— With assistance by Vildana Hajric, Claire Ballentine, and Katherine Greifeld