(Bloomberg) — Asian equities advanced, following gains in the US, as a decline in Treasury yields helped bolster the allure of holding equities. Traders are closely watching for any further news around President-elect Donald Trump’s planned administration.
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MSCI’s gauge of regional shares climbed more than 1% as benchmarks rose in Japan, Australia and South Korea. Chinese stocks were mixed. Bloomberg’s gauge of the dollar headed for a third day of losses as the so-called Trump trade that had bolstered the greenback and pushed up US yields has at least temporarily lost momentum.
The Nasdaq 100 outperformed Monday, halting a five-day run of losses, with Tesla Inc. jumping 5.6% on a news report Trump’s transition team is seeking to ease federal framework for fully self-driving vehicles.
“Asia equity markets are catching the tailwind from a better trading session in the US,” said Frederic Neumann, chief Asia economist at HSBC Holdings Plc in Hong Kong. “With US rates edging lower, this is giving risk assets a little relief across the region.”
Treasuries edged higher in Asia with the 10-year yield slipping one basis point to 4.40% after dropping three basis points in the US. The yen strengthened versus all its Group-of-10 peers, paring some of its recent weakness. Japanese Finance Minister Katsunobu Kato said there was no change in the government’s stance on taking appropriate measures against excessive currency movements.
“Further sharp gains in dollar-yen can in turn prompt Japan’s Ministry of Finance to step into markets to prop up the yen,” Carol Kong, strategist at Commonwealth Bank of Australia, wrote in a research note.
Trump’s transition team is considering pairing Kevin Warsh, a former Federal Reserve official, in the Treasury secretary role, with hedge fund manager Scott Bessent as director of the White House’s National Economic Council, according to people familiar with the matter.
“A more measured and experienced team in financial leadership positions in the US government will be positive for investor confidence,” said Rajeev De Mello, a global macro portfolio manager at Gama Asset Management. “That has helped Asian equities and currencies.”
The Australian dollar headed for a third day of gains after central bank minutes showed policymakers thought their current settings were appropriate to try to pull down core inflation that is still “too high.”
In corporate news, Xiaomi Corp. shares reversed earlier gains to drop as much as 4% in Hong Kong, as investors took profit after the company’s profit beat expectations and its co-founder raised his targets on electric vehicles.
The S&P 500 rose 0.4% on Monday, while the Nasdaq 100 climbed 0.7%. The S&P 500 Index will advance through the end of next year amid continued US economic expansion and earnings growth, according to Goldman Sachs Group Inc.’s chief equity strategist David Kostin.
Bitcoin extended its gains after rising above $91,000 Monday. The crypto currency is back in the vicinity of an all-time high, supported by a salvo of developments highlighting the deepening embrace of the digital-asset industry in the US under crypto cheerleader Donald Trump.
Oil was little changed after surging on Monday amid simmering geopolitical tensions. West Texas Intermediate rose to settle above $69 a barrel after the US gave Ukraine the green light to use long-range missiles inside of Russia, amping up tensions between the warring nations.
Gold extended gains as Goldman Sachs reiterated a forecast for prices to reach $3,000 an ounce next year.
Top Justice Department antitrust officials have decided to ask a judge to force Alphabet Inc.’s Google to sell off its Chrome browser in what would be a historic crackdown on one of the biggest tech companies in the world. The department will ask the judge to require measures related to artificial intelligence and its Android smartphone operating system, according to people familiar with the plans.
Key events this week:
Eurozone CPI, Tuesday
US housing starts, Tuesday
Fed’s Jeff Schmid speaks, Tuesday
China loan prime rates, Wednesday
Nvidia earnings, Wednesday
Fed’s Lisa Cook and Michelle Bowman speak, Wednesday
Eurozone consumer confidence, Thursday
US existing home sales, initial jobless claims, Philadelphia Fed factory index, Thursday
