Asian stocks edge higher; dollar holds retreat

Stacks of 2017 50 subject uncut sheets of $1 dollar notes at the U.S. Bureau of Engraving and Printing in Washington, D.C., U.S., November 2017. (Bloomberg pic)

SYDNEY: Asian stocks posted modest gains, tracking a rise in US equities after a better than expected reading on the US economy and a rally in tech shares buoyed sentiment. The dollar steadied and Treasury yields ticked lower.

Equity indexes in Japan and Australia edged higher while the South Korean benchmark slipped. Futures pointed to gains in Hong Kong and China. Earlier, the S&P 500 Index rose a fourth day to close above 2,900 for the first time. The pound climbed after the European Union revived hopes of a Brexit deal. Oil climbed past US$69 a barrel.

Equities are rallying as August draws to a close, with Asia-Pacific stocks recouping much of the losses seen earlier this month. Central bank support in China has gone some way to stabilising the currency and stemming a rout in Shanghai stocks, though worries remain concerning the US-China trade spat and the pace of monetary tightening in the US. Next up are Thursday’s reports on US personal income and spending for July.

Elsewhere, Argentina’s peso tumbled to a record low after President Mauricio Macri asked the International Monetary Fund to speed up disbursements from its US$50 billion credit line to ease the nation’s financial crisis. Crude oil added to gains following a bigger-than-expected decline in US crude stockpiles. Terminal users can read more in our Bloomberg Markets Live blog here.

Main moves in markets:

Stocks

Japan’s Topix index gained 0.5% as of 9.12am in Tokyo. Australia’s S&P/ASX 200 Index rose 0.3%. South Korea’s Kospi index was little changed. Futures on the FTSE China A50 Index added 0.5%. Futures on Hong Kong’s Hang Seng Index gained 0.6%. S&P 500 futures were little changed. The S&P 500 climbed 0.6%.

Currencies

The yen was steady at 111.71 per dollar after slipping 0.4%. The offshore yuan was at 6.8202 per dollar. The Bloomberg Dollar Spot Index was flat. The euro bought $1.1709. The pound traded at $1.3035 after rising 1.2%.

Bonds

The yield on 10-year Treasuries held at 2.88%. Australia’s 10-year bond yield climbed two basis points to 2.57%.

Commodities

West Texas Intermediate crude was little changed at US$69.65 a barrel, the highest in seven weeks, after jumping 1.4%. Gold was steady at $1,206.31 an ounce.