Stocks climbed in Asia and bonds remained under pressure following unexpectedly strong U.S. hiring data that reinforced confidence in global growth.
Shares rose in Australia, Japan and South Korea, while Australian bonds added to declines. The yen held near a two-month low as investors assessed the latest poor approval ratings for Japan’s Prime Minister Shinzo Abe. Bank of Japan Governor Haruhiko Kuroda said the economy was turning toward moderate expansion. Inflation data Monday will provide the latest clues on the strength of China’s economy, following broad-based American payroll gains.
Bond yields are rising worldwide as central banks stoke expectations for higher interest rates, while global stocks are close to all-time highs. Investors are shrugging off political uncertainty and placing their faith in a continued earnings expansion on broadening global growth.
The Group-of-20 summit made little headway on dominant foreign policy issues such as North Korea’s escalation of tensions. Meetings between U.S. President Donald Trump and the leaders of South Korea, Japan and China ended without a clear consensus about how to curb North Korea’s nuclear ambitions.
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Here’s what investors will be watching:
- China CPI probably rose 1.6 percent in June year-on-year from 1.5 percent in May, while PPI should hold at 5.5 percent, forecasts show. The release is due at 9:30 a.m. Beijing time. The PBOC is expected this week to update money supply and new yuan loan data. Total social finance in June could climb to 1.4 trillion yuan ($206 billion) from 1.06 trillion yuan in May, reflecting looser monetary conditions and a seasonal bounce.
- Data due on Japan balance of payments and machine orders, followed by German trade figures.
- Federal Reserve Chair Janet Yellen’s testimony before Congress will be in focus later this week as investors look for guidance of when the U.S. central bank could start reducing its balance sheet. Other Fed speakers include Lael Brainard, while there’s plenty of data releases. Retail sales, industrial output and business inventories may sway GDP forecasts and CPI could signal if disinflation is intensifying.
These are the main moves in markets:
- The yen traded at 114.03 per dollar as of 9:44 a.m. in Tokyo.
- The yield on 10-year Australian government bonds rose one basis point to 2.74 percent.
- The yield on 10-year Treasuries was steady at 2.39 percent after rising 24 basis points in the past two weeks.
- The S&P 500 Index futures were up 0.1 percent.
- Japan’s Topix index added 0.3 percent. Australia’s S&P/ASX 200 Index gained 0.5 percent and South Korea’s Kospi index rose 0.1 percent. Futures on Hong Kong’s Hang Seng Index rose 0.1 percent.
- WTI crude rose 0.9 percent to $44.62 a barrel following its 2.8 percent slide Friday.
- Gold rose 0.1 percent to $1,213.16 an ounce.