Asian Stocks Edge Up, Japan Bond Auction in Focus: Markets Wrap
(Bloomberg) — Asian stocks edged higher at the open, staging a tentative rebound after Monday’s selloff which saw cryptocurrencies lead declines in global risk assets.
Shares in Japan, Australia and South Korea all rose in early trading on Tuesday. Contracts for US stocks were little changed after the S&P 500 fell 0.5% and the Nasdaq 100 dropped 0.4%. Bitcoin edged lower to trade around $86,400 after losing more than 5% on Monday.
Focus will now turn to this year’s final auction of 10-year Japanese government bonds after increased speculation over an interest-rate hike saw yields surge on Monday. The yen was little changed against the dollar after rising the most in a week on Monday, when Bank of Japan Governor Kazuo Ueda sent the clearest hint yet that his board might raise rates soon.
China Vanke Co., the distressed builder that surprised markets last week when it proposed an unspecified delay in paying a local bond, also remains on investors’ radar. The firm has now asked holders to wait a year to be made whole, as it faces mounting liquidity pressure amid waning state support.
Global markets had a shaky start to December as nearly $1 billion of leveraged crypto positions were liquidated during Monday’s sharp drop that brought fresh momentum to a wide-ranging industry plunge.
Treasuries steadied after falling across the curve on Monday, leaving the US 10-year yield seven basis points higher at around 4.1%. A gauge of the dollar was steady in early Asian trading. Australia’s 10-year yield climbed five basis points.
Elsewhere, silver retreated from a record high, with a key technical indicator showing that a six-day rally has taken the white metal into overbought territory. Gold was little changed.
“There’s some risk aversion creeping into the markets to start the week,” said Kyle Rodda at Capital.com. “At the moment, it looks benign and without a fundamental impetus.”
Read: Bitcoin’s BOJ Stumble Shows Dovish Fed Isn’t Enough for Crypto
US Economy
In the US, Federal Reserve officials will get a dated reading on their preferred inflation gauge before next week’s rate decision. The report due Friday is expected to show that inflationary pressures are stable, but sticky. Yet the debate will largely center on the job market when policymakers meet Dec. 9-10.
US energy producer stocks rose Monday, tracking an advance in oil. Crude prices climbed as a key pipeline linking Kazakh fields to Russia’s Black Sea coast halted loading after one of its three moorings was damaged amid Ukrainian attacks in the region over the weekend.
Data Monday showed US factory activity shrank in November by the most in four months as orders weakened. In addition to Friday’s inflation data, other relevant economic data this week include ADP private employment figures for November and a preliminary reading of consumer confidence in December.
Still, key data like the jobs report won’t arrive until after the December rate decision, which “drastically dilutes this week’s ability to spring any material surprises in as far as rate cut expectations are concerned,” noted Fawad Razaqzada at Forex.com.
“We have highlighted that stocks historically performed best when the economy is not in recession and the Fed is cutting interest rates,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management. “The latest available data suggest that the Fed is more likely to proceed with a 25-basis-point cut.”
She also noted that the current soft patch in the US economy is likely temporary, and global growth should accelerate in 2026.
Corporate News
Warner Bros. Discovery Inc. was fielding a second round of bids on Monday, including a mostly cash offer from Netflix Inc., in an auction that could wrap up in the coming days or weeks, according to people familiar with the discussions. Jane Street Group and Citadel Securities reported gains in third-quarter trading revenue, cutting further into Wall Street’s dominance of that business and leaving the two market-making firms on track for record years. After 13 years of running South Korea’s largest cryptocurrency exchange, Song Chi-hyung and Kim Hyoung-nyon have cemented their spots among the world’s wealthiest. China’s DeepSeek unveiled two new versions of an experimental artificial-intelligence model it released weeks ago, adding fresh capabilities the startup said would help with combining reasoning and executing certain actions autonomously. Chinese vaccine makers are caught in a steep downturn, as intensifying competition pushes prices lower and erodes profits, underscoring the far-reaching deflationary pressure across the world’s second-largest economy.
Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 9:34 a.m. Tokyo time Hang Seng futures rose 0.6% Nikkei 225 futures (OSE) rose 0.6% Japan’s Topix rose 0.3% Australia’s S&P/ASX 200 rose 0.2% Euro Stoxx 50 futures were little changed Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1606 The Japanese yen was little changed at 155.59 per dollar The offshore yuan was little changed at 7.0738 per dollar The Australian dollar was little changed at $0.6540 Cryptocurrencies
Bitcoin was little changed at $86,473.37 Ether rose 0.2% to $2,798.88 Bonds
The yield on 10-year Treasuries was little changed at 4.08% Japan’s 10-year yield advanced 1.5 basis points to 1.880% Australia’s 10-year yield advanced five basis points to 4.61% Commodities
West Texas Intermediate crude rose 0.4% to $59.55 a barrel Spot gold fell 0.1% to $4,226 an ounce This story was produced with the assistance of Bloomberg Automation.
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