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Asia Stocks Slip Amid Earnings; Yuan Retreats


Standard Group (SDG) according to Bloomberg news on 30 July 2018 - Asian stocks began the week in the red as investors questioned earnings results against lofty expectations and prepared for key policy meetings from the world’s biggest central banks. The onshore yuan added to last week’s slump, driven in part by China’s moves to ease monetary conditions.

Equities in Tokyo, Seoul and Sydney fell, as did shares in Hong Kong and China. U.S. equity futures indicated modest declines when New York trading begins after the S&P 500 Index closed weaker Friday. The yen steadied and Japanese bond yields edged higher. The dollar ticked higher alongside U.S. Treasury yields. Central bank policy decisions and a slew of earnings reports, including from Apple Inc., are set to dominate moves in financial markets this week. Investors will focus on whether the BOJ will fine tune its policy and look for any indications the Federal Reserve is shying away from two more interest-rate hikes before the end of this year.

Elsewhere, oil rose toward $69 a barrel on a draft proposal to roll back U.S. automobile efficiency requirements that may increase fuel consumption.

Here are some key events coming up this week:

  • Earnings season continues with Apple, Berkshire Hathaway, Barclays, Tesla, Toyota, BMW, and Rio Tinto among companies reporting results.
  • Central banks in the U.S., Japan, the U.K., Brazil and India all meet this week. The BOJ may tweak its yield-curve control policy and cut its CPI forecasts, while the Bank of England is expected to hike even amid Brexit gloom. The Fed is seen standing pat, as is Brazil’s central bank. The RBI will probably raise its benchmark.
  • U.S. personal spending and income data for June -- coming Tuesday -- may be steady. Then it’s the jobs report on Friday, which is predicted to show a healthy labor market, with 193,000 new jobs, and an unemployment rate slipping back to 3.9 percent.
  • China’s PMIs probably edged down in July, analysts say, buffeted by a deleveraging agenda and a trade war.

These are the main moves in markets:

Stocks

  • Japan’s Topix index fell 0.3 percent as of 10:42 a.m. in Tokyo.
  • Hong Kong’s Hang Seng Index retreated 0.5 percent.
  • The Shanghai Composite fell 0.1 percent.
  • Australia’s S&P/ASX 200 Index lost 0.5 percent.
  • South Korea’s Kospi index fell 0.2 percent.
  • Futures on the S&P 500 were down 0.2 percent. The underlying measure fell 0.7 percent Friday.

Currencies

  • The yen was flat at 111.02 per dollar.
  • The offshore yuan was down 0.4 percent to 6.8417 per dollar.
  • The euro was flat at $1.1659.
  • The Bloomberg Dollar Spot Index was up 0.1 percent.

Bonds

  • The yield on 10-year Treasuries ticked higher to near 2.96 percent.
  • Australia’s 10-year bond yield was steady at 2.64 percent.
  • Japan’s 10-year bond yield edged up to 0.105 percent.

Commodities

  • West Texas Intermediate crude increased 0.3 percent to $68.89 a barrel.
  • Gold slid 0.1 percent to $1,223.38 an ounce.
  • Copper on the LME dropped 0.3 percent to $6,277 per ton.