Stocks Trade Mixed in Asia, Australia Bonds Rally: Markets Wrap


(Bloomberg) — Asian stocks saw muted trading Thursday amid a mixed picture for corporate earnings. Australia’s benchmark bond yields fell to a record low after the central bank governor said he’s prepared to cut interest rates again if needed.

Benchmark indexes nudged higher in Japan, Hong Kong, China and Australia. Korean stocks declined. U.S. futures were flat, while Nasdaq contracts slid. Earlier, U.S. stocks closed at record highs. After regular trading finished, Facebook climbed on higher-than-forecast revenue, while Ford and Tesla slumped on disappointing results. Australia’s dollar dipped after Reserve Bank Governor Philip Lowe’s remarks, which included the expectation for borrowing costs to be low for an “extended period.”

Broadly positive earnings reports have buoyed U.S. stocks so far this week, though Asia has seen initial gains dwindle amid lingering trade concerns and worries about the global economy. Central banks remain in focus with the European Central Bank meeting Thursday, where its message will be closely parsed for signs of a September move as poor economic data ramps up pressure to deliver stimulus.

“Our clients are really struggling with what to do,” Christine Hurtsellers, chief executive officer at Voya Investment Management, told Bloomberg TV. “When you think about the Fed and the pivot and just seeing interest rates go down, clients have this tension of needing to stay invested, needing to earn some kind of return, but fearful that equities look overvalued.”

Meanwhile, geopolitical risk remains a concern, after South Korea reported that North Korea launched two projectiles from the eastern part of the Korean Peninsula.

Elsewhere, oil held losses as economic uncertainty outweighed a drop in U.S. supply. European bonds surged, pushing yields sharply lower on optimism over a September rate cut. The pound rebounded after Boris Johnson became the U.K.’s new prime minister.

Here are some key events coming up:

Earnings season rolls on with companies including Amazon.com, Alphabet, Unilever and McDonald’s still to report this week.Thursday brings the European Central Bank policy decision. Economists widely expect officials to signal their readiness to cut interest rates and potentially broaden stimulus. Some see the chance of an immediate rate cut. ECB President Mario Draghi holds a briefing afterward.

These are the main moves in markets:

Stocks

MSCI Asia Pacific Index edged up 0.1% as of 12:18 p.m. in Tokyo.Japan’s Topix index rose 0.2%.Australia’s S&P/ASX 200 Index added 0.5%.South Korea’s Kospi index fell 0.9%. Hong Kong’s Hang Seng Index rose 0.3%.S&P 500 futures were flat after the index closed at the highest on record. Nasdaq futures fell 0.3%.

Currencies

The Japanese yen was little changed at 108.14 per dollar.The offshore yuan was flat at 6.8764 per dollar.Bloomberg Dollar Spot Index was little changed.The euro traded at $1.1135, near the weakest in almost eight weeks.The British pound was steady at $1.2474 after rising 0.4%.

Bonds

The yield on 10-year Treasuries traded at 2.04%.Australia’s 10-year bond yield dropped 5 basis points to 1.25%.

Commodities

West Texas Intermediate crude added 0.3% to $56.05 a barrel.Gold was steady at $1,422.40 an ounce.

To contact the reporter on this story: Andreea Papuc in Sydney at apapuc1@bloomberg.net

To contact the editor responsible for this story: Christopher Anstey at canstey@bloomberg.net

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

©2019 Bloomberg L.P.



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