Asian Stocks Hit Record High in Anticipation of U.S. Data

Stocks in Asia extended their best week since March, as investors await U.S. inflation data and earnings from some of America’s biggest banks.

Shares in Japan, Australia and South Korea advanced at the end of a week characterised by dovish comments from U.S. policy makers that also weighed on the dollar. The Dow Jones Industrial Average reached a fresh high as Federal Reserve Chair Janet Yellen reiterated her intention to tighten only gradually. The yield on 10-year Treasuries remained down for the week, at 2.35 percent. The yen weakened, though was still in line for its first weekly gain in five.

U.S. consumer inflation due later Friday will be scrutinized as Yellen said it’s premature to conclude that the underlying trend of prices is falling short of the Fed’s 2 percent target. Investors also get clues on how choppy data during the second quarter translated into corporate earnings when JPMorgan Chase & Co., Wells Fargo & Co. and Citigroup Inc. report results. U.S. retail sales and industrial production figures are also due.

Mario Draghi will attend this year’s U.S. Federal Reserve symposium in Jackson Hole, opening the possibility that he could send a message on the European Central Bank’s bond-buying program as the euro area becomes less reliant on stimulus.

Here are the main moves in markets:

Currencies and bonds

· The yen was down 0.2 percent at 113.45 per dollar as of 2:05 p.m. in Tokyo. The Bloomberg Dollar Spot Index was unchanged after falling 0.1 percent Thursday to its lowest since September.

· The Aussie rose 0.2 percent to 77.45 U.S. cents. The Thai baht gained 0.2 percent as it headed for its biggest weekly advance since May.

· The 10-year U.S. Treasury yield was steady at 2.35 percent. The yield on 10-year Australian notes rose four basis points to 2.73 percent.

Stocks

· The MSCI Asia Pacific Index rose 0.3 percent, extending this week’s advance to 2.6 percent.

· Japan’s Topix Index added 0.5 percent. The Nikkei 225 lagged, rising just 0.2 percent as weak third-quarter earnings dragged Fast Retailing Co. lower. See chart here.

· Hong Kong’s Hang Seng gained was steady after advancing 4 percent this week, the most in a year. The Shanghai Composite Index was down 0.2 percent.

· Australia’s S&P/ASX 200 Index rose 0.5 percent Friday and South Korea’s Kospi added 0.2 percent.

· Futures on the S&P 500 Index were little changed. The underlying gauge rose 0.2 percent Thursday.

Commodities

· WTI crude slid 0.2 percent to $46 a barrel, paring its weekly advance to 4 percent.

· Gold fell 0.1 percent to $1,216.72 an ounce.

Source: Bloomberg

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