© Reuters. MANAGEMENT PHOTO: A man stands on a viaduct with an electronic board showing the stock index of Shanghai and Shenzhen in Shanghai
By Hideyuki Sano and Matt Scuffham
TOKYO / NEW YORK (Reuters) – Asian equities jumped from a two-month low on Wednesday after bond yields weakened after a very good auction, and as Chinese equities gained a foothold following recent strong declines in policy tightening .
MSCI’s equities index ex-Japan in Asia Pacific rose 0.4%, a day after reaching a two-month low. The CSI300 index of A shares on mainland China rose 0.7% in early trading.
The setback came after Chinese stocks fell to their lowest level since the previous day in mid-December over the prospect of tougher policies and a slow economic recovery.
was little changed while e-mini futures for the canopy were 0.25%, wiping out earlier gains.
“Markets pay full attention to bonds. As earnings are not growing as fast at present, the high share prices we have now will not be sustainable if bond yields continue to rise and their valuation undermines,” said Hiroshi Watanabe, senior economist. of Sony (NYSE 🙂 Financial Holdings.
Yields on the standard 10-year notes fell to 1.539%, after peaking at 1.626% on Friday, after Tuesday’s $ 3 billion auction in US 3-year notes was well received.
Still, many market investors have been on the verge, with the following tests for investors’ appetite for government debt set to take place later this week in the form of ten- and thirty-year auctions.
“Although the bond market has risen slightly, the pressure will remain,” said Naokazu Koshimizu, senior rate strategist at Nomura Securities.
“It has been praised in the future normalization of the Fed’s monetary policy, and the Fed’s policy is finally becoming neutral. But it has not yet praised the chances of its policy being tightened.”
Some investors see a real risk of an overheated US economy and higher inflation as a result of planned spending by the Biden government, including a $ 1.9 billion stimulus and a larger infrastructure initiative.
On Wall Street, each of the major averages closed higher, led by a nearly 4% rise in the Nasdaq, giving the technology index its best day since November 4th.
The index was very susceptible to climax figures, and Monday’s decline has dropped it by more than 10% since the end of February 12, confirming that it is widely regarded as a correction.
“Today the 10-year is a little lower, and it takes pressure off valuations, so technology is performing well. The market is just getting comfortable at this level of rates,” said Kristina Hooper, Invesco’s chief global market strategist , said. York.
The faster deployment of COVID-19 vaccines in some countries and the planned U.S. stimulus package have helped support a better global economic outlook, the Organization for Economic Co-operation and Development said when it increased its 2021 growth forecast.
In foreign exchange markets, the back of a 3-1 / 2 month high of 92,506 returned to 92,138.
The euro rose to $ 1.1881, at Tuesday’s low 3 1/2 month of $ 1.18355, while the 108.76 yen per dollar changed hands, above a nine-month low of 109.235 the previous day.
The foreign government strengthened to 6.5235 per dollar as Tuesday’s low of 6.5625 in three months.
Oil prices have declined due to easing concerns about supply disruption in Saudi Arabia.
futures slipped 0.3% to $ 63.72 a barrel, away from a high of about 2 1/2 years of $ 67.98 touched on Monday.
futures settled at $ 67.52 a barrel, up 72 cents or 1.06%.