Asian stocks traded in narrow ranges today, Thursday, after US stocks rose and Treasury bonds fell, as a result of data showing US consumers’ expectations for continued inflation.
Shares fell in Australia while remaining unchanged in South Korea. Hong Kong stock futures fell. Japan's markets will be closed today for a holiday.
Shares of Chinese construction companies rose after news that Beijing included the two troubled construction companies, Country Garden Holdings and Sino-Ocean Group, in a draft list of construction companies eligible for financial support, in the latest step to close a deficit estimated at 446 million dirhams. Billion dollars to alleviate the housing crisis. The real estate equity index is on track for its best week since early September.
The S&P 500 index rose 0.4% yesterday, Wednesday, before the Thanksgiving holiday, resuming the November rise that lifted the index about 8%, making it on track to achieve its best month since July of last year. US futures witnessed little change in early Asian trading.
US inflation expectations
Treasuries fell on Wednesday, affecting Australian and New Zealand government bond yields in Asian trading. The Asian Treasury market will be closed for the holiday in Japan.
The selling of Treasuries sent two-year and five-year bond yields higher by three basis points. The increase in yields reflects new data showing that Americans expect inflation to rise at an annual rate of 4.5% over the next year, up from the 4.4% expected earlier this month, according to the University of Michigan.
Although Treasury yields rose on Wednesday, the long-term downward trend in interest rates will help stocks and bonds rise next year, according to Audrey Goh, head of asset allocation and strategy for the wealth management group at Standard Chartered Bank.
We expect the stock market rally to continue,” Goh said in an interview with Bloomberg TV. He added: If you look at inflation, it is clear that it has moderated so that it will allow the Fed to hold its ground. Our expectation is that official interest rates have peaked.
Higher US yields helped the dollar, which rose against major currencies on Wednesday, extending its decline from earlier in the week. Asian currencies were weak on Thursday, with the yen stable at more than 149 against the dollar after its weakness in the previous session.
In Asia, the Indonesian central bank is expected to keep its benchmark interest rate steady. The data to be released includes both industrial production in Taiwan and consumer prices in Singapore.
On the other hand, reports showed that some market participants are concerned about reconnecting with the Industrial and Commercial Bank of China after a cyber attack that affected the trading process. The bank's shares fell in early trading on Thursday.
Origin Energy Ltd will ask investors to vote on a revised A$19.1 billion (US$12.5 billion) offer from a group led by Brookfield Asset Management Ltd next month, postponing the planned meeting. After the results of a third-party vote showed that the current proposal would fail.
Oil extended losses in Asia after falling nearly 1% in the previous session on news that the OPEC+ alliance of oil-producing countries will postpone its meeting, reducing the likelihood of imminent production cuts to support prices.
