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Stock markets across Asia were on the upswing and bonds were in retreat on Friday morning in the face of a stronger dollar and following on from a banner day on Wall Street.
Stocks across Asia took their cues from Wall Street, where the S&P 500 index closed 0.6 per cent higher after hitting an all-time intraday high as sentiment improved on the vague promise of a “phenomenal” corporate tax announcement in the next two to three weeks from US President Donald Trump.
Tokyo’s broad Topix index was up 2 per cent as energy stocks rose 3.6 per cent and consumer discretionary stocks jumped 2.5 per cent. Shares in oil and gas company Inpex rose 4.8 per cent ahead of its third-quarter earnings report expected to reflect gains from higher oil prices. The financials, real estate and industrials segments all saw rises of around 2.2 per cent as well. The Nikkei 225 index was up 2.5 per cent.
Australia’s S&P/ASX 200 was up 0.7 per cent in spite of a firmer Australian dollar as information technology stocks climbed 1.7 per cent and energy stocks rose 1.5 per cent. Shares in oil and gas company Santos rose 3.5 per cent after data showed global exports of liquefied natural gas rose in the 11 months ended November.
In Hong Kong the Hang Seng index was up 0.7 per cent in morning trade as energy, industrials and consumer discretionary segments jumped 0.6 per cent. In China the Shanghai Composite index was up 0.3 per cent while the Shenzhen Composite was flat.
The dollar index tracking the greenback against a basket of peers was up 0.1 per cent at 100.71 in Asia morning trade after rising 0.4 per cent on Thursday, bringing it 0.8 per cent higher for the week.
Japan’s yen was 0.4 per cent weaker against the dollar at ¥113.71, its softest level since February 1.
The Australian dollar was flat at $0.7623 following lower-than-expected home loans data and slightly lower forecasts for long-term economic growth from the Reserve Bank of Australia’s Statement on Monetary Policy.
China’s renminbi was 0.1 per cent weaker at Rmb6.8734 after the central bank set the currency’s dollar trading band 0.2 per cent weaker on Friday morning.
Sovereign bonds in the region were retreating on Friday in the face of an equities rally. Yield, which moves inversely to price, on 10-year US Treasuries was up 2 basis points at 2.141 per cent.
Yield on 10-year Australian government bonds was up 6bp at 2.699 per cent after the RBA revised its long-term GDP growth forecasts lower. Yield on New Zealand 10-year sovereign notes rose 4bp to 3.176 per cent.
Japan’s 10-year government bonds saw yield rise briefly before reverting to be flat at 0.088 per cent, while that for South Korean 10-year notes rose 1bp to 2.141 per cent.
Oil prices were resting comfortably after climbing further up from lows hit earlier in the week. Brent crude, the international benchmark, was up 0.1 per cent at $55.71 a barrel after gaining 0.9 per cent on Thursday. West Texas Intermediate, the US marker, was up 0.2 per cent at $53.11 a barrel after rising 1.3 per cent the day prior.
The stronger dollar, treasury yields and stock market gains helped push gold lower, as the price for an ounce of the yellow metal dropped 0.5 per cent in Asia trading to $1,224.31 per ounce.