Photographer: Kiyoshi Ota / Bloomberg
Photographer: Kiyoshi Ota / Bloomberg
Asian equities came under pressure on Thursday after the dollar climbed and U.S. equities returned in the wake of the Federal Reserve’s minutes signaling optimism about growth in the second half.
Shares fell in Japan, Australia and South Korea, while S&P 500 futures fell. US equities outperformed gains earlier than the Fed noted the health crisis would “weigh heavily” on economic activity and reiterated his view that the path of recovery would depend on containment of the virus. The greenback steeped, holding profits that came after a sell-off of five days. Gold paired an overnight stay. Treasury yields edge higher.
After closing a record for the first time since the pandemic began this week, US equities have declined as investors debate whether momentum can be sustained amid high ratings and uncertainties about further government stimulus. Meanwhile, Fed officials said the virus posed a manly risk to the economic outlook in the medium term.
Policymakers are likely to be more concerned about the pace of recovery “given the stalemate over fiscal stimulus in Washington,” said Marvin Loh, senior global macro strategist at State Street. “The Fed will continue to do what it can, but it does to feel that fiscal is as important in the recovery process as monetary, and its tool for obtaining funds Main Street remain restricted. ”
Democratic and Republican leaders say they are looking for a way to ease stalemate over the next round of relief from pandemic – even as both sides remain far from a deal. Any agreement will likely still wait until September despite the fact that the U.S. economy is catching up with many companies still struggling and millions of Americans out of work.
Elsewhere, oil slipped from a five-month high, as OPEC + alliance urged members to follow suit to limit exports, as the coronavirus pandemic threatens a demand for recovery.
Here are some important events to come:
- Results of Alibaba Group Holding Ltd. and Qantas Airways Ltd. are to be thanked Thursday.
- U.S. unemployment claims for the week ending August 15 are due Thursday
- China’s prime rate is due on Thursday.
- Euro area PMIs will be released on Friday.
Joachim Fels, global economic adviser at Pacific Investment Management Co., says the Federal Reserve will adopt an “opportunistic reflection strategy” where they are ready to oversee the inflation target to make up for past underhoots.
These are some of the key movements in markets:
Shares
- S&P 500 futures lost 0.4% from 9:15 a.m. in Tokyo. The index dipped 0.4% on Wednesday.
- Japan’s Topix index fell 0.3%.
- Kospi index fell 0.5%.
- Australia’s S & P / ASX 200 index fell 0.8%.
Currency
- The Bloomberg Dollar Spot Index did not change much after jumping 0.6%.
- The euro bought $ 1.1840, slightly changed.
- The yen was stable at 106.11 per dollar.
- The offshore yuan traded at 6.9235 per dollar.
Bonds
- The yield on Treasury of 10 years dropped one basis point to 0.67%.
- Australia’s 10-year yield increased 2 basis points to 0.88%.
Commodities
- West Texas Intermediate crude fell 0.8% to $ 42.60 per barrel.
- Gold rose 0.4% to $ 1,937.79 an ounce.
– With the help of Rita Nazareth, Claire Ballentine, and Vildana Hajric
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