Capital Market

Stocks set for steady start ahead of China data: markets wrap

Stocks set for steady start ahead of China data: markets wrap
Mining News Pro - Asian stocks looked set for a steady open Monday as traders await key Chinese economic data and monitor bond-market volatility triggered by high inflation and the prospect of tighter monetary policy.
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Gyrations in sovereign bonds point to the worry that central banks will have to tighten policies more quickly than expected to curb sustained inflation. In contrast, global stocks near record levels signal equity investors are reassured by corporate strength and arguments that price pressures are transitory.

“The risk is that the FOMC will need to raise the Fed funds rate by more than we expect if inflation remains persistently high,” Kim Mundy, a strategist at the Commonwealth Bank of Australia, wrote in a note.

Federal Reserve Bank of Minneapolis President Neel Kashkari said the U.S. central bank shouldn’t overreact to elevated inflation even as it causes pain, because it is likely to prove temporary. Treasury Secretary Janet Yellen said controlling the Covid-19 virus in the U.S. is the key to easing price pressures.

Elsewhere, President Joe Biden will meet virtually with Chinese President Xi Jinping on Monday. Tensions between the two countries have been building over issues including Taiwan and restrictions on sales of U.S. technology to China.

Meanwhile, Elon Musk raised the idea of selling more of his Tesla Inc. shares in online sparring with U.S. Senator Bernie Sanders. Musk offloaded almost $7 billion worth of Tesla stock over the past week, weighing on the shares of the electric vehicle manufacturer.

In commodities, oil prices have notched the longest stretch of weekly losses since March. Senate Majority Leader Charles Schumer urged Biden to tap the U.S. government’s reserves of emergency fuel to help lower gasoline prices.

What to watch this week:
China October property prices, retail sales, industrial production. Monday
President Joe Biden, President Xi Jinping to meet virtually. Monday
Fed Presidents Thomas Barkin, Esther George, Raphael Bostic, Patrick Harker speak at various events. Tuesday
Reserve Bank of Australia Governor Philip Lowe delivers a speech Tuesday
RBA minutes of November meeting. Tuesday
U.S. retail sales are poised to show an acceleration in October as consumer demand remains resilient. Tuesday
Euro zone CPI. Wednesday
Conference Board U.S. leading index, initial jobless claims. Thursday
Fed’s Richard Clarida and Mary Daly speak at Asia Economic Policy Conference. Friday

Stocks
The S&P 500 rose 0.7%
The Nasdaq 100 rose 1%
Nikkei 225 futures rose 0.5%
Australia’s S&P/ASX 200 Index futures were little changed
Hang Seng Index futures rose 0.2% earlier

Currencies

The Japanese yen was at 113.97 per dollar
The offshore yuan traded at 6.3785 per dollar
The Bloomberg Dollar Spot Index fell 0.2% Friday
The euro was at $1.1444

Bonds
The yield on 10-year Treasuries advanced one basis point to 1.56%
Australia’s 10-year bond yield fell one basis point to 1.78%

Commodities
West Texas Intermediate crude fell 1% to $80.79 a barrel
Gold was at $1,864.90 an ounce


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