Morning Markets: Asian stocks rally, yen softens
Watchlist
- Japan: Machinery orders (published)
- Japan: Balance of payments (published)
- China: PPI and CPI (published)
- Norway: CPI (published)
- Greece: CPI (0900 GMT)
Asia-Pacific stocks rose broadly on Monday, boosted by a higher Friday close on Wall Street, signs of stabilising oil prices and some regional M&A deals.
The Japanese yen softened through 114 to the US dollar, and Japan's Nikkei 225 gained 0.8%.
US stocks climbed on Friday as the market interpreted the US employment report positively.
Chinese producer and consumer price growth steadied in June on a year-on-year basis at the same pace as in May, and the data on Monday were interpreted as encouraging for the global economy.
Oil prices rose in Asian trading.
The second-quarter earnings season gets started in earnest this week, with quarterly reports due, for instance, from PepsiCo on Tuesday and from major US banks JPMorgan, Wells Fargo and Citigroup on Friday.
Other key events on the calendar this week are a Bank of Canada interest-rate announcement --with a hike widely expected -- and Fed chief Janet Yellen's testimony to Congress on Wednesday.
Market signals
Asian session
- Japan's core machinery orders fell 3.6% in May from the April figure
- The Japanese government downgraded the outlook for machinery orders
- Japan's current account surplus fell sharply in May, due to high oil prices
- Japan's goods trade showed a ¥115.1 bn deficit in May, the first deficit in four months
- The Nikkei 225 defied the gloom and rose; it was up 0.76% to 20,080.27 at 0517 GMT
- Friday's gains on Wall St helped lift sentiment in Asian markets
- China's producer price index rose 5.5% in June from a year earlier
- The CPI increased 1.5%, less than the forecast of 1.6%
- The Chinese data kept investors upbeat about the global economy
- Hong Kong's Hang Seng soared; up 1.06% to 25,609.57 at 0540 GMT
- Shanghai Composite edged lower; it was down 0.07% to 3,215.59 at 0538 GMT
- WTI crude rose 0.9% to $44.62/barrel following its 2.8% slide on Friday
- Australia's S&P/ASX gave up some early gains; it was up 0.42% to 5,727.60 at 0521 GMT
Forex ahead
- USD gained ground against the yen; it was worth ¥114.1515 at 0528 GMT
- AUD managed to scrape back above 0.76; it was worth 0.7610 at 0524 GMT
From the Floor
US jobs report. “Very strong payrolls, but that weak earnings release suggest the Fed is not going to be in any hurry to unwind,” says Hardy.
Asian USD profit-taking. "[Emerging markets] in general benefited from the equity rally in the US, but we saw some profit-taking this morning in Asia in the dollar," says Horchani.
Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.
In opinion
1...2...3
The market may have reacted strongly to the US nonfarm payroll data, but when looked at closely, the rise in jobs is more subdued than people think, says James Picerno.
Full steam
Asia shrugged off any lingering doubts about rising bond yields, and took to stocks with renewed fervour in early trading, Saxo's Singapore team reports.
Macro missile
There' s been a lot of talk about a North Korean belligerence, but what might come next if the talk notches up into something more, asks Kay Van-Petersen.
Dented
Metals prices have proven vulnerable to rising bond yields after a hawkish tilt among central banks, while oil remains under pressure, writes Ole Hansen.
Morning Markets goes out on the TradingFloor platform at 0700 GMT, Monday to Friday.
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