Stocks rise amid China stimulus, countdown to Powell: Markets close

Stocks rise amid China stimulus, countdown to Powell: Markets close

(Bloomberg) — An Asian stock index rose on Thursday, as China’s latest steps to shore up its economy steadied some nerves in eager anticipation for a key speech by Federal Reserve Chairman Jerome Powell at the Jackson Hole meeting. .

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The regional indicator rose by around 1%, following Hong Kong after a delay in the start of trading due to a storm. US and European futures rose after the positive closes of the S&P 500 and Nasdaq 100.

China has stepped up stimulus with another 1 trillion yuan ($146 billion) in measures for an economy hit by housing problems, Covid-linked mobility restrictions and some power outages. Mainland share gains lagged behind, suggesting uncertainty over whether efforts are sufficient.

Anguish over Powell’s comments on Friday centers on whether he will refute expectations that slowing growth will moderate US monetary tightening in the next phase of the campaign against high inflation.

Treasury bonds fell and the two-year yield was in sight of 3.40%. A dollar meter dipped. Crude oil contributed to a rally that could fuel renewed nervousness over whether price pressures have peaked.

Fed officials in the run-up to Jackson Hole made it clear they saw more monetary tightening ahead, a message that eroded a mid-June jump in stocks and bonds. The tension in the markets is whether these assets will continue to return to the lows of the year.

“The market is really trying to justify a bear market rally and it’s looking for that dovish pivot from the Fed and it’s unlikely to get that,” Mehvish Ayub, senior investment strategist at State Street Global Advisors, told Bloomberg Television. “We have to keep expecting that volatility, not just ahead of Jackson Hole, ahead of any kind of narrative from Fed officials.”

South Korea’s central bank raised borrowing costs and projected faster inflation. Earnings and bond yields advanced. The currency led an Asian basket tracked by Bloomberg.

In Europe, natural gas prices have soared to new highs, intensifying an energy crisis that threatens the eurozone economy and therefore global prospects.

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What to watch this week:

  • US GDP, Initial Jobless Claims, Thursday

  • The Kansas City Fed hosts its annual economic policy symposium in Jackson Hole, Wyoming, on Thursday

  • ECB July Minutes, Thursday

  • Fed Chair Powell Speaks at Jackson Hole, Friday

  • US Personal Income, PCE Deflator, University of Michigan Consumer Sentiment, Friday

Some of the main movements in the markets:

Actions

  • S&P 500 futures were up 0.4% at 7am in London. The S&P 500 rose 0.3%

  • Nasdaq 100 futures rose 0.4%. The Nasdaq 100 is up 0.3%

  • Japan’s Topix index rose 0.5%

  • South Korea’s Kospi index up 1%

  • Australia’s S&P/ASX 200 index rose 0.7%

  • China’s Shanghai Composite Index rose 0.2%

  • Hong Kong’s Hang Seng Index rose 1.6%

  • Euro Stoxx 50 futures rose 0.2%

Coins

  • The Bloomberg Dollar Spot Index is down 0.2%

  • The euro was at $0.9992, up 0.3%

  • The Japanese yen traded at 136.71 to the dollar, up 0.3%

  • The offshore yuan was at 6.8584 per dollar, up 0.3%

titles

goods

  • West Texas Intermediate crude rose 0.4% to $95.25 a barrel

  • Gold was at $1,756.92 an ounce, up 0.3%

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