Global stock rally builds in Asia; dollar slips: markets wrap

Most Asian stocks advanced Thursday and the region was on course to erase this year’s declines as the global equity rally that’s driven shares higher since March continued to strengthen. The dollar weakened and Treasury yields ticked lower.

Shares in Japan saw the bulk of gains, with South Korea and China also higher. Hong Kong dipped, and Australian equities underperformed as earnings at some firms disappointed. S&P 500 futures were little changed after the benchmark momentarily topped its February high, capping the more than 50% rally since the market lows in March. Gold resumed its advance. The Aussie rose after a better-than-expected pickup in jobs in July.

Stock markets around the world are recovering losses triggered by the initial onset of the global pandemic, though investors continue to bank on further stimulus and Federal Reserve speakers sounded more urgent about the need to protect a nascent recovery. Dallas Fed President Robert Kaplan called on officials to push harder for adherence to protective behaviors and said extending unemployment benefits is “critical” to growth.

Meantime, some hard-hit US states showed signs of improvement, with Texas and California reporting falling hospitalisations from the virus.

“The main force that’s been driving markets the last few weeks has really been momentum,” said Kevin Caron, portfolio manager for Washington Crossing. “We’ve got a market that’s focused on the good case outcome for the virus, we’ve got a market that has taken a great deal of comfort in that fiscal policy is going to be there to support an economy through tough times.”

Elsewhere, oil was steady after rising earlier on signs of improving demand.

These are the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 11:10 a.m. in Hong Kong. The index rose 1.4% on Wednesday.
• Hong Kong’s Hang Seng slipped 0.2%.
• Shanghai Composite added 0.3%.
• Japan’s Topix index advanced 0.9%.
• South Korea’s Kospi climbed 0.6%.
• Australia’s S&P/ASX 200 Index slid 0.4%.
• Euro Stoxx 50 futures fell 0.3%.

Currencies

• The yen was at 106.65 per dollar, up 0.2%.
• The offshore yuan traded at 6.9343 per dollar.
• The Bloomberg Dollar Spot Index fell 0.2%.
• The euro bought $1.1809, up 0.2%.
• The Aussie climbed 0.1% to 71.70 U.S. cents.

Bonds

• The yield on 10-year Treasuries was down three basis points to 0.65%.
• Australia’s 10-year yield dropped three basis points to 0.89%.

Commodities

• West Texas Intermediate crude dipped 0.1% to $42.64 a barrel.
• Gold was at $1,937.79 an ounce, up 1.2%.

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