(Bloomberg) — Asian equities traded in narrow ranges after US stocks rose for a fifth session. Bloomberg’s dollar index held near a one-year high as traders bet the currency will benefit from President-elect Donald Trump’s agenda.
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Benchmark share indexes edged higher in Japan, while ticking lower in Australia and South Korea. Futures in Hong Kong pointed down amid disappointment over Chinese stimulus. US stock futures were little changed following a decline in technology shares on Monday that offset gains in other parts of the market.
Investors in Asia are still digesting Beijing’s latest stimulus package, which relieved some of the debt burden on local governments but lacked the sweeping fiscal support many investors had hoped for. Chinese data published Monday showed that credit expansion slowed more than economists forecast last month.
Bitcoin’s record-breaking rally took the digital asset past $89,000 and lifted the overall value of the crypto market above its pandemic-era peak as traders bet on a boom under President-elect Donald Trump.
“The central theme stemming through markets has again been expressing Trump 2.0, with this evolving thematic working concurrently with the sell China vibe that resonates, with further fallout from the lack of demand-driven policies detailed at Friday’s China’s NPC meeting,” Chris Weston, head of research at Pepperstone Group Ltd. in Melbourne, wrote in a note.
The S&P 500 rose 0.1% on Monday, hovering near the 6,000 mark and notching its 51st record this year. The Dow Jones Industrial Average gained 0.7%.
The next major item on the agenda looks to be US inflation figures due Wednesday. The core consumer price index, which excludes food and energy, likely rose at the same pace on both a monthly and annual basis compared with September’s readings.
Treasury 10-year notes dropped at the open after being closed worldwide on Monday for a US holiday. The yield climbed three basis points to 4.33%. The Bloomberg Dollar Spot Index was little changed after jumping 0.5% Monday. Oil ticked up following its biggest decline in two weeks.
Japanese Prime Minister Shigeru Ishiba on Monday pledged more than $65 billion of support for the nation’s semiconductor and artificial intelligence sector over the next decade. He was speaking at a press briefing after winning a vote in parliament to stay on as premier.
The prime minister said he wanted to spread positive examples of regional revitalization like TSMC’s chip plant in Kumamoto across the nation, and hoped aid for the sector would serve as a catalyst to generate public and private investment of more than ¥50 trillion ($325 billion) over the next 10 years. The semiconductor company Renesas Electronics Corp. shares jump at the open.
Trump Rally
US stocks may rally more into year-end following Trump’s presidential election victory than they did when he won the presidency eight years ago, according to JPMorgan Chase & Co.
“I expect 2024 returns to be larger than 2016,” Andrew Tyler, the bank’s head of US market intelligence, wrote in a note to clients. A big advantage for the S&P 500 is weakness outside the US, with China, the UK, EU, Canada and Mexico all experiencing softer growth than they did back then.
The “animal spirits” being set loose by the economic policies of President-elect Trump will send the S&P 500 to 10,000 by the end of the decade, according to veteran strategist Ed Yardeni.
His bullish prediction, which would represent a 66% surge by 2030, is another sign that Wall Street is growing increasingly optimistic about stock markets in the wake of the US election. Yardeni lifted year-end targets to 6,100 for 2024, 7,000 for 2025 and 8,000 for 2026.
Key events this week:
Germany CPI, ZEW survey, Tuesday
Fed speakers include Christopher Waller, Patrick Harker and Neel Kashkari, Tuesday
Fed issues survey of senior bank loan officers, Tuesday
Eurozone industrial production, Wednesday
US CPI, Wednesday
Fed speakers include Jeffrey Schmid, Lorie Logan, Neel Kashkari and Alberto Musalem, Wednesday
Eurozone GDP, Thursday
US PPI, jobless claims, Thursday
Walt Disney earnings, Thursday
Fed speakers include Jerome Powell, John Williams and Adriana Kugler, Thursday
China retail sales, industrial production, Friday
US retail sales, Empire manufacturing, industrial production, Friday
Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 10:05 a.m. Tokyo time
Hang Seng futures fell 0.6%
Japan’s Topix rose 0.8%
Australia’s S&P/ASX 200 fell 0.5%
Euro Stoxx 50 futures fell 0.3%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0657
The Japanese yen was little changed at 153.86 per dollar
The offshore yuan was little changed at 7.2260 per dollar
Cryptocurrencies
Bitcoin rose 1.4% to $89,243.64
Ether was little changed at $3,324.63
Bonds
The yield on 10-year Treasuries advanced two basis points to 4.33%
Japan’s 10-year yield was unchanged at 0.995%
Australia’s 10-year yield was little changed at 4.57%
Commodities
West Texas Intermediate crude rose 0.3% to $68.26 a barrel
Spot gold rose 0.2% to $2,623.95 an ounce
This story was produced with the assistance of Bloomberg Automation.
