Gold Silver Reports – Stock Gains Extend to Asia on Profit, U.S. Tax: Markets Wrap – Asian stocks followed gains in U.S. equities as earnings and congressional action on tax reform boosted confidence in the growth outlook.
Equity benchmarks rose in Tokyo, Seoul and Sydney as technology shares rallied following stellar profit at Amazon.com Inc. and Alphabet Inc. that buoyed futures on the Nasdaq 100 Stock Index. The S&P 500 Index climbed as results from Twitter Inc. and Ford Motor Co. topped estimates, showing strength in the American economy ahead of the first reading on gross domestic product for the third quarter. The dollar maintained gains after rallying to its highest since July after the U.S. House passed a budget resolution seen as advancing the prospects for tax reform. The British pound declined on the prospect of a hard Brexit.
The MSCI Asia Pacific Index advanced, though its set to finish its first down week in four, amid record low volatility. Volatility in the last 60 trading days has dropped below 6 percent to the lowest since Bloomberg started compiling the data in 1988. Read more here.
The euro extended a drop. European Central Bank President Mario Draghi outlined plans to halve its monthly bond purchases to 30 billion euros ($35 billion) from 60 billion euros starting in January, but he also indicated that zero percent interest rates could remain at current levels until “well past” whenever it finally decides to end its quantitative easing measures, dragging down the common currency.
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Meanwhile, the pound headed lower after Andreas Dombret, Bundesbank board member for banking supervision, wrote in Focus magazine that a “hard Brexit would be economically manageable.”
House Republicans adopted a budget resolution unlocking a process to cut taxes by the end of the year. President Donald Trump continued to string out his decision on the next Federal Reserve leader, giving mixed signals on his preference.
Japan’s inflation remained unchanged in September, underscoring the challenge facing the Bank of Japan ahead of a policy meeting next week.
Terminal users can read more in our Markets Live blog.
These are some of the remaining events on the slate for this week:
- The advance reading on U.S. third-quarter GDP is due Friday morning in Washington. Economists surveyed by Bloomberg expect growth of 2.6 percent.
- President Donald Trump has said he’ll reveal his choice to lead the Fed by Nov. 3. The Fed’s next rate decision is on Nov. 1, with economists expecting the central bank to keep rates at 1.25 percent and to increase them at the December meeting.
And here are the main moves in markets:
Stocks
- Japan’s Topix index rose 0.4 percent as of 9:23 a.m. in Tokyo, heading for its seventh weekly advance. The Nikkei 225 Stock Average added 0.5 percent.
- Australia’s S&P/ASX 200 Index added 0.1 percent. Macquarie Group Ltd. was largely behind the gain, up 3.3 percent, the most in almost a year to a record high, after forecasting full-year earnings to rise.
- South Korea’s Kospi index climbed 0.2 percent.
- Hong Kong’s Hang Seng Index futures rose 0.2 percent.
- Futures on the Nasdaq 100 rose 0.3 percent in the final minutes of Thursday trading after the tech giants reported results.
- S&P 500 Index contracts fell less than 0.1 percent. The underlying index climbed 0.1 percent Thursday and the Dow Jones Industrial Average rose 0.3 percent.
Currencies
- The Bloomberg Dollar Spot Index rose 0.1 percent after increasing 0.7 percent on Thursday.
- The yen fell 0.1 percent to 114.07 per dollar.
- The euro lost 0.1 percent to $1.1633 after dropping 1.4 percent Thursday.
- The Aussie bought 76.52 U.S. cents.
- The pound slid 0.3 percent to $1.3127.
Bonds
The yield on 10-year Treasuries fell one basis point to 2.45 percent. Yields increased three basis Thursday.
Australia’s 10-year yield rose two basis points to 2.78 percent.
Commodities
- West Texas Intermediate crude was steady at $52.67 a barrel. It advanced 0.9 percent on Thursday.
- Gold was at $1,267.23 an ounce after it dipped 0.8 percent in the previous session.
