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Asian Stocks Gain on Trade Deal; Yen Advances


Standard Group (SDG) according to Bloomberg news on 26 July 2018 - Asian stocks climbed, tracking gains in U.S. shares, after President Donald Trump reached an agreement with European Commission President Jean-Claude Juncker aimed at averting a transatlantic trade war. The yen climbed and the dollar retained its losses.

Equities from Tokyo to Hong Kong advanced after the S&P 500 Index rose to within 1 percent of a fresh record high, with the two sides agreeing to suspend new tariffs while negotiating over trade. The yield on 10-year Treasuries edged lower while the Japanese equivalent ticked up to levels matching those reached at the start of this week amid speculation the Bank of Japan is paving the way for a change in policy. The offshore yuan strengthened amid signs of further policy easing. Weak sales at Facebook dragged Nasdaq futures lower.

Trump’s meeting with Juncker came amid a raft of earnings from U.S. companies, some of which reflected the impact of recent trade threats from the White House. Facebook tumbled 20 percent in after-hours trading as revenue and user growth missed estimates and General Motors shares plunged after the carmaker cut its profit forecast on surging metals prices.

Elsewhere, West Texas crude ticked up above $69 a barrel as stockpiles decreased. Gold gained, as did copper futures.

Here are some key events coming up this week:

  • Earnings season continues with the following tech companies among those reporting: Amazon.com, Twitter, Advanced Micro Devices, Qualcomm and Intel. Others include Nissan and Shell.
  • The European Central Bank’s policy decision is Thursday.
  • U.S. gross domestic product probably increased by about 4.2 percent at an annualized rate in the second quarter, the most since 2014, economists forecast ahead of Friday’s data.

These are the main moves in markets:

Stocks

  • Japan’s Topix index rose 0.8 percent as of 10:30 a.m. in Tokyo.
  • Hong Kong’s Hang Seng Index gained 0.6 percent.
  • The Shanghai Composite rose 0.1 percent.
  • Australia’s S&P/ASX 200 Index fell 0.2 percent.
  • South Korea’s Kospi index rose 0.9 percent.
  • Futures on the S&P 500 Index slid 0.1 percent after the underlying gauge gained 0.9 percent Wednesday. Nasdaq futures sank 0.6 percent.

Currencies

  • The Bloomberg Dollar Spot Index held losses after sinking 0.5 percent to the lowest in almost seven weeks.
  • The euro bought $1.1743 after advancing 0.4 percent.
  • The offshore yuan rose 0.3 percent to 6.7433 per dollar.
  • The yen gained 0.2 percent to 110.79 per dollar.

Bonds

  • The yield on 10-year Treasuries held at 2.97 percent.
  • The yield on 10-year Japanese government bonds rose 2.5 basis points to 0.09 percent.

Commodities

  • The Bloomberg Commodity Index increased 1 percent Wednesday to its highest in over two weeks.
  • West Texas Intermediate crude gained 0.4 percent to $69.56 a barrel.
  • Copper rose 1.2 percent on the LME to $6,367 a ton.