U.S. and European futures soared alongside most Asian stocks on Tuesday on optimism over coronavirus treatments and signs of progress in trade talks. The offshore yuan strengthened and the dollar slipped.
Shares rose in Japan, Australia, and South Korea, fluctuated in China, and fell in Hong Kong. S&P 500 futures rose after the benchmark hit another all-time high, with companies enjoying a more robust economic recovery leading gains. The Nasdaq Composite closed at a record high for a second consecutive session. Ten-year Treasury bond yields rose, while their Chinese counterparts rose most in seven weeks.
The United States and China have spoken about the Phase 1 trade pact. The two sides see progress and are determined to ensure the deal’s success, the US trade representative said. Trade among the world’s largest economies has become a rare area of cooperation in the otherwise strained bilateral relationship.
Investors are also focusing on vaccine advancements as economies reopen. Moderna Inc. said it was close to an agreement to provide at least 80 million doses of the vaccine to the European Union. President Donald Trump has said blood plasma-based treatment donated by people who have recovered from Covid-19 will be expanded.
“A constant stream of progress with Covid-19 treatments / vaccines is bringing the latest boost in risk appetite,” said Edward Moya, senior market analyst at OANDA, in a note. He warned that “the size of the market, however, does not support the push to record territory for US indices.”
Traders are also awaiting a speech scheduled for Thursday by Federal Reserve Chairman Jerome Powell on the Fed’s long-awaited monetary policy framework review, which focused on a new inflation strategy.
Oil retreated as traders watched Tropical Storm Laura, which is expected to turn into a hurricane before making landfall later this week. Gold was trading below $ 1,950 an ounce.
Here are some key upcoming events:
- Profits from companies like ICBC, PetroChina, HP Inc., Royal Bank of Canada, Best Buy and Dollar General.
- The Republican American National Convention begins Monday.
- The Bank of Korea sets monetary policy and will hold a briefing on Thursday.
- Fed Chairman Powell speaks at an event Thursday.
Here are the main movements in the markets:
- S&P 500 futures rose 0.5% at 1:06 p.m. in Tokyo. The S&P 500 Index climbed 1%.
- The Topix index rose 1.6%.
- The Kospi index rose 1.5%.
- The S & P / ASX 200 rose 0.4%.
- The Hang Seng index fell 0.5%.
- The Shanghai Composite Index fell 0.2%.
- The Japanese yen was at 105.96 per dollar.
- The offshore yuan rose 0.1% to 6.9054 per dollar.
- Bloomberg Dollar Spot Index fell 0.2%
- The euro was at $ 1.1813, up 0.2%.
- The yield on 10-year Treasury bills was 0.66%.
- West Texas Intermediate crude fell 0.1% to $ 42.58 a barrel.
- Gold rose 0.4% to $ 1,937 an ounce.
– With the help of Claire Ballentine and Sarah Ponczek
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