Asia Stocks Set for Mixed Start; Oil Plunges: Markets Wrap


Asia stocks are set for a muted start to trading Thursday as investor concerns around a trade war between the U.S. and China showed little sign of abating. The dollar rose and crude oil plunged the most in two years.

Equity futures in Japan pointed to modest gains while those in Hong Kong and Sydney signaled slight declines. The S&P 500 dropped the most in two weeks, as energy and material producers tumbled on renewed angst that the Trump administration’s trade stance will damp demand for commodities. Oil’s retreat took West Texas crude toward $70 a barrel, while metals and crop futures also slid. The dollar saw the biggest rise in a month, while the Japanese yen and Chinese offshore yuan dropped. Ten-year Treasury yields were little changed.

Traders continue to deal with the possibility of a further escalation in the dispute between the world’s two largest economies and the impact that quarrel could have on global growth. Washington and Beijing now have about seven weeks to strike a deal or dig in for a trade war that could upend corporate supply chains and raise prices for consumers. However, high-level trade talks between the pair were said to have ground to a halt, just as investors were poised to turn their focus to corporate earnings season and growth in the economy.

Terminal users can read more in Bloomberg’s Markets Live blog.

Elsewhere, Turkey’s lira sank to a record low as a local television channel said President Recep Tayyip Erdogan sees the exchange rate and interest rates falling amid uneasiness about his tightening grip over the central bank.

These are some events to look out for this week:

  • Earnings season gets into gear with JPMorgan Chase & Co. and Citigroup Inc. among the largest companies due to give results, as well as India’s Infosys Ltd.
  • The most noteworthy U.S. data may be the June inflation report on Thursday, which consensus expects will show both headline and core price growth picking up.
  • Chinese trade data due at the end of the week will probably show slightly slower export growth, after early indicators pointed to softer overseas demand and weaker export orders, Bloomberg Economics said.

And here are the main market moves:

Stocks

  • Futures on the Nikkei 225 rose 0.3 percent in Singapore
  • SPI 200 futures fell 0.1 percent
  • Hang Seng futures fell 0.2 percent
  • Futures on the S&P 500 Index advanced 0.1 percent. The underlying gauge sank 0.7 percent Wednesday.
  • The Stoxx Europe 600 Index fell 1.3 percent, the biggest drop in more than two weeks.

Currencies

  • The Bloomberg Dollar Spot Index gained 0.7 percent, most since June 14.
  • The Japanese yen traded at 111.95 per dollar after dropping 0.9 percent.
  • The offshore yuan fell 1.1 percent to 6.7227 per dollar.
  • The euro steadied at $1.1674 after a 0.6 percent decline.

Bonds

  • The yield on 10-year Treasuries was little changed at 2.85 percent.

Commodities

  • West Texas Intermediate crude was at $70.55 a barrel after its 5 percent slide.
  • Gold was up 0.1 percent to $1,243.19 an ounce after slipping 1.1 percent.

Read Asia Stocks Set for Mixed Start; Oil Plunges: Markets Wrap on bloomberg.com



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