Mon, August 15, 2022

Asian Stocks Gain on Wall Street Optimism

Wall Street could Rebound amid Stop-Gap Funding Approval

Asian stocks rose on Friday after Wall Street finished the volatile trade in positive territory, adding to the previous session’s big gains, although lingering investor anxiety support safe-haven currencies such as yen.

MSCI’s broadest index of Asia-Pacific shares excluding Japan gained 0.8 percent. It has slipped 3 percent so far in December.

The Shanghai Composite index perked up 0.35 percent. Australian stocks added 1 percent and South Korea’s KOSPI increased 0.5 percent. Japan’s Nikkei bucked the trend and slumped 0.3 percent, losing some steam after surging almost 4 percent on Thursday.

US stock roared back to end in positive territory on Thursday, with the Dow adding 1.14 percent, after suffering sharp losses for much of the session. S

The gains come a day after Wall Street indexes posted their biggest daily percentage increases in almost a decade following a steep plunge at the beginning of the week.

On the other hand, all three US major indexes remain down more than 9 percent for December following losses earlier in the month, when factors including concerns over the US-China trade war, slowing global growth and wariness toward the Federal Reserve’s tightening cycle took a heavy toll.

“Selling pressure on US equities is beginning to dissipate, but the VIX index is still around 29 with investor risk sentiment still recovering.  A renewed market slide remains a risk,” said Junichi Ishikawa, who is the senior FX strategist at IG Securities based in Tokyo.

The CBOE Volatility Index soared midweek to 36, its steepest level since early February. It has since pulled back lower than 30 but remains well above a recent trough of 15 at the beginning of December.

Focus turned to the Fed’s stance and whether the equity markets can sustain their recovery at the start of the New Year.

“If Fed officials – notably Chairman (Jerome) Powell and New York Fed Governor Williams – shows a cautious stance toward further rate hikes given recent instability in the stock markets, that would lead to a rise in US equities and Treasury yields, and a firmer dollar,” said Masafumi Yamamoto, who is the chief forex strategist at Mizuho Securities in Tokyo.

Fed Chairman Jerome Powell is scheduled to give a speech on January 4.

While stocks showed indications of recovery, looming market volatility aided in keeping safe-haven currencies such as the yen and the Swiss franc in demand.

The dollar extended overnight losses and was lower 0.3 percent at 110.64. It was on its way to lose more than 2 percent this month.

wall street

The greenback slipped 0.3 percent to 0.9851 francs per dollar after slumping more than 0.8 percent during the previous day. The US currency has fallen 1.1 percent against its Swiss peer on the month.

The euro was a shade higher at $1.1450 after gaining 0.7 percent overnight. The common currency was set for a 1 percent gain in December.

The 10-year US Treasury note yield was higher 3 basis points at 2.773 percent, pulling back from a nine-month low of 2.720 percent brushed earlier this week.

The yield had climbed to a seven-year peak of 3.26 percent in October when the debt market had gotten ready for a potentially faster pace of Fed rate hikes in 2019.

YOU MAY ALSO LIKE

Oil Declines Following Disappointing Chinese Data

Brent crude futures dropped $3.49, or 3.56%, to $94.66 a barrel by

BDOmarkets Review

Broker Review: BDOmarkets General Information & First Impressions BDOmarkets is a brokerage

New Medicine With Higher Prices In The U.S.

Reuters found that some pharmaceutical manufacturers are keeping the secret about the

COMMENTS

Comments are closed.

BROKER NEWS

BROKER NEWS