Stocks in Asia drifted at the open Monday as investors look for clues on the economic recovery in a big earnings week and a Federal Reserve meeting. The dollar and Treasuries were steady.
Benchmarks fluctuated in Japan and Australia, and edged higher in South Korea. U.S. futures were little changed after most major groups in the S&P 500 advanced Friday. U.S. new-home sales rebounded in March to the highest since 2006, while output at manufacturers and service providers reached a record high in April. The 10-year Treasury yield hovered below 1.6%.
The dollar maintained losses against major peers in early trading. Oil and gold were little changed.
Focus turns to the Fed meeting, with policy makers reiterating that they are in no hurry to withdraw support even as the U.S. economy rebounds. A slew of earnings from megacaps including Tesla Inc., Facebook Inc. and Apple Inc. will be parsed as investors look for clues on how companies are faring in the recovery.
“If we are going to see big jumps in earnings growth for these companies this week, then I think those it’s a positive backdrop for the markets,” Ben Emons, Medley Global Advisors global macro strategy managing director, said on Bloomberg Television. On the Fed meeting, “Treasury yields have declined a little bit, they’ve taken back rate hikes in the future and we can’t really expect the Federal Reserve or other central banks to lift off so quickly, so soon given the uncertainty about the pandemic,” Emons said.
Equities whipsawed last week amid a flare-up in global coronavirus cases and news that the White House plans to propose almost doubling the capital-gains tax rate for the wealthy.
On the virus front, India’s Covid-19 crisis is worsening, with a million cases added in the past three days.
Here are some key events to watch this week:
Bloomberg Live hosts the Bloomberg Green Summit Monday through April 27Bank of Japan rate decision and Governor Haruhiko Kuroda briefing TuesdayFed Chair Jerome Powell holds a press conference Wednesday following the FOMC meetingJoe Biden makes his first address as president to a joint session of Congress WednesdayU.S. GDP is forecast to show robust 6% growth in the first quarter, bolstered by government stimulus Thursday
These are some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 9:15 a.m. in Tokyo. The S&P 500 rose 1.1% FridayTopix index was flatAustralia’s S&P/ASX 200 Index was little changedKospi index rose 0.3%
Currencies
The yen was little changed at 107.93 per dollarThe offshore yuan was at 6.4879 per dollarThe Bloomberg Dollar Spot Index was little changedThe euro traded at $1.2096
Bonds
The yield on 10-year Treasuries held at 1.56%Australia’s 10-year bond yield fell to 1.72%
Commodities
West Texas Intermediate crude dipped 0.2% to $62.02 a barrelGold was at $1,776.92 an ounce
