October 19, 2021

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Asian Stocks Set for Gains; Dollar Extends Losses: Markets Wrap

(Bloomberg) — Asian stocks looked set for a solid start to the week after their U.S. peers climbed Friday as prospects for a pickup in growth outweighed concern over inflation pressures.

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Futures pointed to gains in Japan and Australia, and U.S. contracts advanced. Mainland Chinese markets are closed through Thursday for the Golden Week holidays. The S&P 500 rose over 1% Friday after promising results for a Covid-19 pill and positive manufacturing data triggered a rally in companies that stand to benefit from an economic reopening.

The dollar extended Friday’s decline against major peers. The yen ticked higher after a record number of flybys by Chinese warplanes close to Taiwan raised tensions in the region. Treasuries climbed Friday, taking 10-year yields down to 1.46%.

Asia traders will be watching closely Monday for news on China Evergrande Group, which faces a maturing bond with little wiggle room for payment. Oil traders will monitor comments from OPEC+ which meets virtually amid a spiral higher in crude prices.

As investor fears mount about slowing economic growth, U.S. labor data at the end of the week will also be a key focus for markets. Last month global stocks posted their worst performance since March 2020 amid concern about elevated inflation, supply-chain bottlenecks, a global energy crunch and a slowdown in China.

Elsewhere, Bitcoin traded around $48,000, largely maintaining its recent gains.

For more market analysis, read our MLIV blog.

Here are some events to watch this week:

  • OPEC+ meets virtually Monday to review output policy amid a global energy crunch.

  • Reserve Bank of Australia policy decision Tuesday

  • Rate decision in New Zealand on Wednesday

  • Reserve Bank of India monetary policy decision on Friday

  • The U.S. Labor Department releases unemployment and job creation data Friday

  • Annual Nobel announcements start on Monday, with the Peace Prize being awarded on Friday

Some of the main moves in markets:

Stocks

  • S&P 500 futures rose 0.4% as of 8:04 a.m. Tokyo time. The benchmark climbed 1.2% Friday

  • Nikkei 225 futures added 0.3%

  • S&P/ASX 200 futures gained 1.6%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.1% Friday

  • The euro rose 0.1% to $1.1607

  • The British pound advanced 0.2% to $1.3570

  • The Japanese yen gained less than 0.1% to 110.99 per dollar

Bonds

Commodities

  • West Texas Intermediate crude dropped 0.1% to $75.83 a barrel

  • Gold rose 0.2% to $1,764 an ounce

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