(Bloomberg) – Asian stocks rise while commodities fall and dollar buys on its allure as investors try to weigh the latest affirmation of China’s Covid-Zero stance for the speculative restriction can be eased.
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Shares in Hong Kong rallied, quickly reversing their initial decline, while benchmark gauges in Japan, South Korea and Australia also rose. Mainland indices fluctuate.
US and European futures slashed losses. Oil and gold remain lower, but above session lows.
The Australian and New Zealand dollars fell the most among Group 10 currencies due to their sensitivity to China’s economic growth outlook. The offshore yuan is weaker.
Confidence was also dented as Apple Inc. forecasts that its latest iPhone shipments will be lower than previously expected amid the impact of China’s shutdown at a supplier’s factory.
Markets continued to be mixed as traders swirled around hopes of China’s reopening from Covid-19 and fears that harsh restrictions will persist. Chinese officials on Saturday vowed to remain strict “unchanged” in Beijing’s approach to killing the coronavirus. The country’s shares surged on Friday as bets to contain the virus eased.
The debate over China’s prospects comes as investors face difficulties from the Federal Reserve’s interest rate hikes. Friday’s US data – showing strong hiring and wage growth coupled with higher unemployment – presented a mixed picture for Fed officials debating extending their campaign. for how long to curb rising inflation.
Fed funds futures are leaning toward valuations up 50 basis points in December, with a peak of around 5.1% next year.
Wall Street’s fear gauge is much lower than the panic levels seen during the pandemic or crisis of 2008, but volatility is a feature of 2022.
Monday’s rise in the dollar follows its steepest drop since March 2020 on Friday according to Bloomberg’s currency gauge. Treasuries were mostly flat in Asia after two-year yields, which are more sensitive to impending policy moves, reversed course and turned lower on Friday.
“Over the next three to four months, the dollar will continue to move higher,” said Mahjabeen Zaman, head of FX research at Australia & New Zealand Banking Group Ltd., on Bloomberg Television. “That really aligns with the recent FOMC Fed meeting we had, where they said they were going to slow down but push rates to the top.”
Markets will be watching for the latest US inflation on Thursday after the core consumer price index rose more than forecast to a 40-year high in September. Even if prices start to moderate, the CPI is well above the Fed’s comfort zone.
This week’s main events:
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Trade China, Monday
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Fed officials Susan Collins, Loretta Mester and Tom Barkin speak at events, Monday
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Euro Area Retail Sales, Tuesday
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US midterm elections, Tuesday
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EIA Oil Inventory Report, Wednesday
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China’s total finance, PPI, CPI, money supply, new yuan loans, Wednesday
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US Wholesale Inventory, MBA Mortgage Application, Wednesday
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Fed officials John Williams, Tom Barkin to speak at events, Wednesday
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US CPI, first US jobless claims, Thursday
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Fed officials Lorie Logan, Esther George, Loretta Mester speak at events, Thursday
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University of Michigan Consumer Sentiment, USA, Friday
Some key moves in the market:
Inventory
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S&P 500 futures were down 0.4% as of 10:51 a.m. Tokyo time. S&P 500 up 1.4% on Friday
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Nasdaq 100 futures fell 0.5%. Nasdaq 100 rose 1.6%
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Topix index up 1.2%
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S&P ASX Index up 0.5%
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Hang Seng Index up 2%
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The Shanghai Composite Index was little changed
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Euro Stoxx 50 futures fell 0.2%
Currency
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The Bloomberg Dollar Spot Index is up 0.3%
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The euro fell 0.2% to $0.9935
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Japanese Yen fell 0.3% to 147.08 USD/USD
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The offshore yuan fell 0.5% to $7.2207/USD
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Australian Dollar down 0.6% to $0.6429
Electronic money
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Bitcoin drops 0.8% to $20,949.55
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Ether drops 1.4% to $1,581.76
Bonds
Goods
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West Texas Intermediate Crude fell 1.2% to $91.52 per barrel
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Spot gold fell 0.5% to $1,673.49 an ounce
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