Asian Stocks Set for Mixed Start; Aussie Slips: Markets Wrap

Asian stocks looked set for a mixed start as investors weighed simmering Sino-American tensions against signs the virus spread in the U.S. may be slowing. The yen nudged higher.

Futures pointed to modest gains in Hong Kong and declines in Australia. Japanese shares looked set for a lower start after a two-day holiday. S&P 500 contracts ticked higher after the benchmark retreated Friday. The Australian dollar dipped as virus data for the country over the weekend fueled concerns. Gold traded above $1,900 an ounce.

Investors this week will be looking to the Federal Reserve’s meeting for clues on what comes next for policy amid expectations for more accommodation ahead. That comes as wrangling continues in Washington over a stimulus bill. On the virus front, cases fell in California, Arizona, Florida and New York.

“The July FOMC meeting should kick off a period from August into mid-September in which markets should price in an increasingly dovish, forward-looking Fed policy via lower real rates,” Morgan Stanley strategists including Matthew Hornbach, wrote in a report. “This should benefit breakeven inflation rates, support risk assets, and weigh on the U.S. dollar.”

Here are some key events coming up:

  • Earnings include, Apple, Amazon.com, Alphabet, Chevron, Rio Tinto, L’Oreal, Caterpillar, Samsung, Barclays and Credit Suisse.
  • The Federal Open Market Committee holds its policy meeting on Tuesday, with an announcement due on Wednesday.
  • U.S. second-quarter GDP is expected on Thursday.
  • China PMI data comes Friday.

These are the main moves in markets:

Stocks

  • Futures on the S&P 500 rose 0.3% as of 7:02 a.m. in Tokyo. The gauge fell 0.6% on Friday.
  • Futures on Japan’s Nikkei 225 slid 0.5%
  • Hang Seng futures rose 0.5%.
  • Futures on Australia’s S&P/ASX 200 Index lost 0.4%

Currencies

  • The yen rose 0.1% to 106.03 per dollar.
  • The Aussie fell 0.1% to 71.01 U.S. cents.
  • The offshore yuan held at 7.0195 per dollar.
  • The euro bought $1.1647, down 0.1%.

Bonds

  • The yield on 10-year Treasuries rose one basis point to 0.59% on Friday.

Commodities

  • West Texas Intermediate crude oil rose 0.1% to $41.32 a barrel.
  • Gold was at $1,901.30 an ounce.

— With assistance by Sophie Caronello

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