Asian Stocks Gain for Third Day as US Futures Slip: Markets Wrap
Asian stocks continued their upward trajectory for the third consecutive day, with Japan and Hong Kong leading the gains. This trend reflects a growing interest in non-US assets amidst the uncertainties surrounding the policies of the Trump administration.
Hong Kong’s equity benchmarks surged by approximately 2%, driven by the soaring shares of BYD Co. following the announcement of a new charging system for electric cars. In Japan, stocks rose by more than 1% after Berkshire Hathaway Inc. increased its stakes in the country’s major trading houses, highlighting optimism about long-term growth prospects. Meanwhile, US equity futures retreated, while European futures saw a slight increase.
Global investors are increasingly looking beyond US markets, especially after the recent correction, with Chinese and Japanese equities emerging as attractive alternatives in Asia. China’s shift towards boosting domestic consumption, as evidenced by recent policy announcements, is seen as a positive step that could make the economy less susceptible to trade tariffs, thereby contributing to a more balanced investment landscape.
Gold prices soared to a new all-time high, surpassing $3,017 an ounce. The yield on 10-year Treasuries experienced a marginal decline to 4.29%, as the Federal Reserve prepared to commence a two-day policy meeting. The Bloomberg Dollar Index also saw a modest gain.
China’s stock market rally, already the best performing in the world, could receive a fresh boost from upcoming tech earnings reports, including those from Xiaomi Corp. and Tencent Holdings Ltd. Foreign investments into China’s onshore markets hit a record high in February, further underscoring the country’s appeal to global investors. Additionally, President Trump’s announcement of an upcoming visit by Chinese leader Xi Jinping to Washington added to the positive sentiment.
In Japan, financial stocks saw gains alongside rising yields ahead of the Bank of Japan’s upcoming decision. The central bank is expected to maintain the policy rate at 0.5%, according to economists surveyed by Bloomberg. The yen weakened against the dollar for the third consecutive day, inching closer to the 150 mark.
On the global front, Indonesian stocks experienced a significant decline, triggering a trading halt due to concerns about a weakening economy and subdued consumption.
Looking ahead, German lawmakers are set to vote on a bill that could unlock substantial funds for defense and infrastructure spending, potentially spurring advances in European stocks. Meanwhile, in the US, retail sales figures for February came in below expectations, though the control-group sales, a critical component of GDP calculation, showed a rebound.
As policymakers assess the impact of Trump’s trade policies on the economy, the Federal Reserve is expected to maintain rates at their current levels. Market participants will closely monitor the central bank’s economic projections and Chair Jerome Powell’s press conference for insights into future monetary policy decisions.
In the commodities market, oil prices rose for the third consecutive day amid escalating tensions in the Middle East, overshadowing concerns about oversupply.
Key events to watch this week include US housing starts, industrial production data, the Bank of Japan rate decision, the Federal Reserve rate decision, China’s loan prime rates announcement, the Bank of England rate decision, Eurozone consumer confidence figures, and speeches by Fed officials.
In summary, global markets are experiencing a mix of positive and negative developments, with investors closely monitoring geopolitical events, economic data releases, and central bank decisions for cues on future market movements.
