Asian Stocks Mixed on Low Volume; Yen Fluctuates

Stocks in Asia were mixed amid low trading volume and the yen held to a narrow range as investors weighed the latest comments from Federal Reserve officials on interest rates and the economy.

South Korea’s Kospi index reversed an early gain, heading for the first decline in seven sessions, while Chinese shares traded in Hong Kong advanced. The rand erased a rally after South African President Jacob Zuma survived a bid by some members of the African National Congress’s top leadership to order his removal from office. Markets are closed in the U.S., the U.K. and China. North Korea fired another missile, which appears to be a Scud variant.

A six-week surge in global equities pushed stocks to a record high as investors bet global economic growth can withstand higher U.S. interest rates as soon as next month. While stocks have recovered from worries surrounding the prospects for President Donald Trump’s reform policies, 10-year Treasuries are on course for a fourth monthly advance amid concern inflation is lagging expectations.

Disagreement on the strength of the U.S. comes as the first hints of China’s economic performance in May suggest that a slowdown in growth is taking hold as policy makers beef up efforts to clamp down on financial risks.

Williams doesn’t vote on monetary policy this year, but he worked closely with Fed Chair Janet Yellen when she led the San Francisco Fed and he was its director of research, and is seen as an influential voice at the central bank.

Here are the main moves in markets:

Stocks

· The Topix index advanced 0.2 percent as of 2:23 p.m. in Tokyo. The Kospi was down less than 0.1 percent after jumping 0.7 percent earlier in the day. Australia’s S&P/ASX 200 Index fell 0.6 percent. The Hang Seng increased 0.1 percent and the Hang Seng China Enterprises Index rose 0.2 percent.

· Futures on the S&P 500 Index rose 0.1 percent after the underlying gauge closed at a record high on Friday.

Currencies and Bonds

· The yen was little changed at 111.30 per dollar.

· The rand was was little changed after erasing a gain of 1.8 percent. Pressure had built on Zuma to quit following his March 31 decision to fire Pravin Gordhan as finance minister in a cabinet reshuffle, a move that sparked public protests and cost the country its investment grade credit rating.

· The offshore yuan rose 0.1 percent, stretching a rally to a fourth day amid suspected intervention from the People’s Bank of China and surging funding costs in Hong Kong.

· The yield on 10-year Treasuries was 2.25 percent at the end of last week.

Commodities

· Oil lost 0.3 percent to $49.66 a barrel. Crude rallied 1.8 percent on Friday, paring a weekly loss, as investors tempered their disappointment over an agreement by OPEC and its allies to extend production cuts without deepening them.

· Gold fell less than 0.1 percent to $1,266.11 an ounce.

Source: Bloomberg

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