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(Bloomberg) — Asian stocks rose on Friday after the S&P 500 index rose to a record high on Friday, buoyed by expectations that the U.S. Federal Reserve will start cutting interest rates later this year.
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Japanese stocks soared on the move, and South Korean stocks also rose, while futures markets suggested a rise in Hong Kong stocks. US contracts rose slightly.
Another rally in technology stocks, the S&P 500’s most influential group, pushed the index to a new two-year high on Friday. The benchmark broke above 4,800, defying warnings that gains remained concentrated in a relatively narrow group of stocks.
The Nikkei 225 index has risen more than 8% this year, leading the gains in major developed markets. The Bank of Japan begins a two-day policy meeting on Monday, but many expect the settings to remain unchanged on Tuesday, when the results of the meeting will be announced.
“The year is off to a dramatic start, with the U.S. S&P 500 and Nasdaq 100 hitting record highs ahead of the weekend,” said Mark Chandler, chief market strategist at Bannockburn Global Forex in New York. It is the Japanese stock market that is suffering.” He said, “Markets are anticipating the start of an aggressive easing cycle by several central banks and the Bank of Japan’s lifting of its negative interest rate policy, but that start is not expected until late in the first half.”
The dollar was little changed against major currencies, continuing its gains this month amid speculation that Federal Reserve policy will give the U.S. economy a soft landing.
In Asia, 10-year US Treasury futures prices rose. This comes after 10-year Treasury yields fell for the first time in a week on Friday as a University of Michigan “Fed-friendly” survey showed a mix of high consumer confidence and lower inflation expectations. Ta.
One of the highlights for investors in Asia on Monday was China’s commercial bank loan prime rates. Interest rates are expected to remain at current levels after the People’s Bank of China left its key policy rate unchanged.
melt-up phase
According to Ed Yardeni, the frenzied melt-up phase for US stocks is already underway and could become irrational. “Unless Fed Chairman Jerome Powell emphasizes that he is in no hurry to ease, a speculative bubble could grow, fueled by money moving from interest-paying instruments to stocks and bonds,” he said in a note.
Investors will also be looking forward to the first estimates of U.S. fourth-quarter GDP to be released on Thursday, central bank meetings in Canada and Europe, as well as economic output data from South Korea and initial figures from the 2024 European Purchasing Managers Survey. will also pay attention.
Oil prices fell slightly as OPEC member Libya resumed production at its biggest oil field, boosting global supplies and outweighing concerns about tensions in the Red Sea, which are expected to continue disrupting shipping.
Ron DeSantis has withdrawn from the U.S. presidential race to support Republican front-runner Donald Trump ahead of Tuesday’s New Hampshire primary.
This week’s main events:
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China loan prime rate, Monday
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US Conference Board Leading Index, Monday
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Bank of Japan interest rate decision, Tuesday
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Eurozone consumer confidence, Tuesday
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Netflix Inc. plans to report earnings.Streaming services set for strong performance heading into 2023 on Tuesday
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Japan trade, Wednesday
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Eurozone S&P Global Services and Manufacturing PMI, Wednesday
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UK S&P Global/CIPS Manufacturing PMI, Wednesday
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US S&P Global Services and Manufacturing PMI, Wednesday
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Tesla Inc. and International Business Machines Inc. (IBM) plan to report financial results on Wednesday.
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European Central Bank interest rate decision Thursday
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Germany IFO Business Environment Thursday
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US GDP, new unemployment claims, durable goods, wholesale inventories, new home sales, Thursday
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LVMH, Northrop Grumman and SK Hynix report financial results on Thursday
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Japan Tokyo CPI, Friday
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Bank of Japan issues minutes of policy meeting on Friday
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US Personal Income and Expenditures, Friday
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Chinese New Year celebrations begin on Friday
stock
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S&P 500 futures were up 0.1% as of 9:10 a.m. Tokyo time. The S&P 500 rose 1.2% on Friday.
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Nasdaq 100 futures rose 0.3%.Nasdaq 100 rises 2%
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Japan’s TOPIX index rose 0.8%
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Australia’s S&P/ASX 200 index rises 0.6%
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Hong Kong’s Hang Seng futures rose 1.1%.
currency
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Bloomberg Dollar Spot Index little changed
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The euro was almost unchanged at $1.0896.
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The Japanese yen remained almost unchanged at 148.04 yen to the dollar.
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The offshore yuan was almost unchanged at 7.2027 yuan to the dollar.
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The Australian dollar was unchanged at US$0.6597.
cryptocurrency
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Bitcoin fell 0.4% to $41,593.
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Ether fell 0.6% to $2,456.93.
bond
merchandise
This article was produced in partnership with Bloomberg Automation.
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