Photographer: Soichiro Koriyama / Bloomberg
Photographer: Soichiro Koriyama / Bloomberg
Treasury and dollar yields soared on Thursday after a report indicated that President-elect Joe Biden plans a $ 2 trillion Covid-19 aid package. In Asia, Japanese stocks outperformed.
Biden’s advisers recently told allies in Congress about the cost of the package, according to the report. Biden is expected to announce his economic support plans later in the day. Yields had stabilized before dropping from the highest levels since March, after two strong bond auctions this week.
An Asia-Pacific stock indicator rose, on the way to another record. US and European stock futures pointed up. Technology stocks led Wall Street’s earnings on Wednesday, with the Nasdaq 100 surpassing the S&P 500.
Alibaba Group Holding Ltd. and Tencent Holdings Ltd. rose after the United States decided not to ban American investment in Chinese technology giants. Oil maintained losses and Bitcoin changed little at around $ 37,500.
“This is going to be a great year for the economy and profits, but just a good year for the stock market,” Bob Doll, chief share strategist at Nuveen, said on Bloomberg TV. “In other words, I think the multiples are retained somewhat because of the modest increase in interest rates and inflation.”
Investors are betting on an economic recovery this year and tolerating tight stock valuations, in part due to expectations of more US fiscal spending and better control of the vaccine pandemic.
The latest comments from legislators also reinforced expectations for a loose monetary policy. Fed Governor Lael Brainard resisted suggestions that the central bank could curtail its bond purchase program this year, while European Central Bank adviser François Villeroy de Galhau said the ECB will maintain a calm stance for as long as necessary.
Federal Reserve Chief Jerome Powell is expected to discuss topics, including the Fed’s policy framework, on Thursday. Previously, the House of Representatives voted to impeach President Donald Trump for the second time. Trump’s Senate trial is unlikely to begin before his term ends on January 20.
On the virus front, the UK reported the highest number of deaths in one day since the pandemic began. Johnson & Johnson’s Covid-19 single-dose vaccine may not be authorized for use until March, weeks after what US officials have suggested.
Bob Doll, Nuveen’s chief stock strategist, says that US economic growth and corporate profits will be “off the charts” this year.
Here are some important events to come:
- JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. is among the companies that are expected to report profits.
- US President-elect Joe Biden plans to chart fiscal support proposals on Thursday.
- Federal Reserve President Jerome Powell participates in a webinar on Thursday.
- Initial data on claims for unemployment benefits in the U.S. are due on Thursday.
- US retail sales, industrial production, commercial inventories and consumer sentiment numbers are due Friday.
These are some of the main movements in the markets:
Stocks
- S&P 500 futures gained 0.3% as of 12:27 pm in Tokyo. The indicator rose 0.2% on Wednesday.
- Japan’s Topix index increased 0.9%. The Nikkei 225 was up 1.4%.
- The Hang Seng index rose 0.5%.
- Shanghai Composite lost 0.3%.
- South Korea’s Kospi index rose 0.1%
- Australia’s S & P / ASX 200 index rose 0.5%.
Coins
- The Bloomberg Dollar Spot Index advanced 0.1%.
- The euro bought $ 1.2142, down 0.1%.
- The yen fell 0.2% to 104.07 per dollar.
- The offshore yuan was trading at 6.4689 per dollar.
Titles
- Yield on 10-year Treasury bills increased by about three basis points, to 1.11%.
Commodities
- West Texas Intermediate crude declined 0.2% to $ 52.81 a barrel.
- Gold was at $ 1,838 an ounce, down 0.4%.
– With the help of Dave Liedtka, Vildana Hajric, Benjamin Purvis, Claire Ballentine, Cormac Mullen and Joanna Ossinger