Asian Stocks Set for Muted Start to the Week: Markets Wrap


(Bloomberg) — Stocks in Asia looked set for a muted start to the week amid further signs of economic softening alongside moves by monetary policy makers to address them.

Futures in Japan and Australia were little changed, with contracts in Hong Kong edging higher. On Friday, the People’s Bank of China said it will cut the amount of cash banks must hold as reserves to the lowest level since 2007, injecting liquidity into an economy facing both a domestic slowdown and trade-war headwinds. S&P 500 futures were steady after U.S. stocks and the 10-year Treasury yield ended Friday little changed as Federal Reserve Chairman Jerome Powell’s last speech before next week’s policy meeting cemented views for another interest-rate reduction.

As the U.S.-China trade war rumbles on with more high-level talks expected next month, data over the weekend showed China’s exports unexpectedly contracted in August and last week’s U.S. employment report was weaker than many forecast. With expectations already running high for central banks around the world to offer more support to economies, traders remain on edge.

Elsewhere, the pound was steady. Boris Johnson isn’t giving up his Brexit plan, despite the latest Tory defection. The British Prime Minister remains committed to pulling the U.K. out of the EU by the end of next month and may challenge legislation requiring him to ask for a delay if there’s no deal by Oct. 19, Foreign Secretary Dominic Raab said.

Meantime, Japan is bracing for potentially record-breaking wind and rain as Typhoon Faxai makes its way toward Tokyo, with forecasts for it make landfall near the city early Monday.

Here are some key events coming up this week:

The U.K. Parliament may be suspended as soon as Monday, and a bill blocking a no-deal Brexit could become law. That bill would derail Prime Minister Boris Johnson’s strategy and could trigger the opposition Labour Party to agree to a general election.OPEC’s monthly oil market report, which includes demand forecasts and production estimates, is due Wednesday.The European Central Bank policy meeting Thursday is widely expected to see a cut to interest rates and a review of all options, including QE. Policy makers will also publish forecasts for growth and inflation. ECB President Mario Draghi will hold a press conference.

These are the main moves in markets:

Stocks

Futures on the S&P 500 Index added 0.1% as of 7:43 a.m. in Tokyo. The underlying gauge rose 0.1% on Friday.Futures on Japan’s Nikkei 225 rose 0.1%.Hang Seng futures added 0.2%.Futures on Australia’s S&P/ASX 200 Index slid 0.1%.

Currencies

The yen was at 106.90 per dollar.The offshore yuan remained at 7.1083 per dollar.The euro bought $1.1027.The British pound was at $1.2281.The kiwi rose 0.3% to 64.26 U.S. cents.

Bonds

The yield on 10-year Treasuries ended Friday flat at 1.56%.Australia’s 10-year yield dropped three basis points to 1.06%.

Commodities

Gold lost less than 0.1% to $1,506.07 an ounce.West Texas Intermediate oil added 0.7% to $56.88 a barrel.

–With assistance from April Ma.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Andreea Papuc

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.



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