Asian Stocks Set for Modest Gains, Dollar Dips: Markets Wrap

Asian equities looked set for modest gains Tuesday as investors awaited President Donald Trump’s last full day in office and mulled stimulus plans from President-elect Joe Biden. The dollar pared an earlier advance.

Futures pointed higher in Japan, Hong Kong and Australia. S&P 500 contracts fluctuated with U.S. markets closed for the Martin Luther King holiday Monday. Treasury futures were little changed. European stocks closed with small gains. The yen edged higher. Investors will watch out for comments from Treasury Secretary nominee Janet Yellen, who has a Senate confirmation hearing Tuesday.

Elsewhere, oil edged lower. Gold climbed and Bitcoin fluctuated around the $36,000 level.

After a strong start to the year, the rally in global stock markets is losing steam as investors turn to the upcoming earnings season and the difficult negotiations facing Biden’s $1.9 trillion Covid-19 relief plan. His proposals could be watered down under congressional opposition, and there’s the possibility that some taxes could rise.

On the coronavirus front, cases topped 95 million, while the U.S. death toll from Covid-19 neared 400,000. The European Union’s executive arm will urge member states to set a target for vaccinating at least 70% of the bloc’s population by this summer.

These are some key events coming up in the week ahead:

  • Earnings come from companies including Bank of America, Morgan Stanley, Procter & Gamble, Intel, and Netflix.
  • Joe Biden takes office as U.S. president on Wednesday.
  • Policy decisions are due Wednesday from central banks in Brazil, Malaysia and Canada. The Bank of Japan and the ECB deliver decisions Thursday.

Here are the main moves in markets:

Stocks

  • Futures on the S&P 500 Index rose 0.2% Monday.
  • The Stoxx Europe 600 Index added 0.2%
  • Nikkei 225 futures rose 0.5%.
  • S&P/ASX 200 futures rose 0.6%.
  • Hang Seng futures were up 0.3%.

Currencies

  • The Bloomberg Dollar Spot Index fell less than 0.1%.
  • The euro was steady at $1.2078.
  • The British pound was flat at $1.3586.
  • The Japanese yen strengthened 0.2% to 103.68 per dollar.

Bonds

  • Germany’s 10-year yield fell one basis point to -0.53%.
  • Treasury 10-year yields were at 1.08% Friday.

Commodities

  • West Texas Intermediate crude dropped 0.5% to $52.09 a barrel.
  • Gold strengthened 0.7% to $1,841 an ounce.

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