(Bloomberg) — European stock futures rose along with Asian stocks after tech earnings lifted Wall Street. The yen weakened as the Bank of Japan kept its most loose monetary policy settings.
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Gains for Euro Stoxx 50 futures indicate the benchmark will issue a daily advance for the first time in two weeks.
While Japanese banks fell following the BOJ decision, stocks in Japan, Australia and China advanced. US futures were little changed after the S&P 500 index rose 2% on Thursday, its best day since the first week of the year as investors cheered broadly positive earnings reports.
The yen fell to 0.9% after the BOJ cut its 10-year bond yield ceiling to 0.5% and its short-term policy rate to minus 0.1% at its first meeting under new governor Kazuo Ueda, as most economists had predicted. The BOJ also announced a review of its policy, which could take up to a year and a half.
Mark Matthews, head of Asia research at Julius Baer, said on Bloomberg Television that the Bank of Japan will adjust its yield-curve control policy at its next meeting in June. “The yen will strengthen against all other currencies, including the dollar.”
Treasuries in Asia steadied after slumping on Thursday when US data showed a surprise increase in inflationary pressures in the first quarter. The dollar gained against all its Group-10 peers.
Chinese banks
In Asia, investors looked ahead to earnings reports from some of the biggest Chinese lenders, including Bank of China Ltd, China Citibank Corporation and Industrial & Commercial Bank of China Ltd.
Chinese banks are a “macro proxy, so this year, if there is a modest acceleration in China’s GDP, bank earnings growth is likely to reverse,” Winnie Wu, China equity strategist at Bank of America Securities, said in an interview. With Bloomberg Television.
Thursday’s rally for U.S. stocks was led by Meta Platforms Inc., Alphabet Inc. and mega-cap technology companies including Microsoft Corp. reflected positive corporate reports, while Intel Corp. The stock released the results late Thursday in after-market trading.
“We’re certainly seeing big tech outperforming earnings, but we’re also seeing a lot of companies that are declining,” Laila Pence, head of Pence Wealth Management, said on Bloomberg Television.
Also read: US has ‘worst of both worlds’ with high inflation, GDP recession
The latest batch of U.S. economic data — including a slowdown in U.S. jobless claims — shows what kind of cognitive distortions investors are grappling with, said Dana Peterson, chief economist at the Conference Board.
“Typically when you have recessions, the labor market collapses in terms of gross domestic product, and we haven’t seen that,” Peterson said. “We’re probably going to sink into a recession, maybe starting as early as the second quarter, but we’ll really have to look at the data.”
Elsewhere, oil headed for a sixth straight month of declines as recession worries in the US and Asia weighed on the outlook. Gold was little changed, while Bitcoin fell another $30,000.
Here are some key moves in the markets:
Shares
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S&P 500 futures were little changed at 2:48pm Tokyo time. The S&P 500 rose 2%
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Nasdaq 100 futures were little changed. The Nasdaq 100 rose 2.8%
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Japan’s Topix rose 1.1%
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Australia’s S&P/ASX 200 rose 0.3%
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Hong Kong’s Hang Seng rose 0.5%
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The Shanghai Composite rose 0.7%
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Euro Stoxx 50 futures rose 0.5%
Coins
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The Bloomberg Dollar Spot Index rose 0.2%
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The euro fell 0.1% to $1.1014
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The Japanese yen fell 0.7% to 134.92 per dollar
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The offshore yuan was up 0.1% at 6.9219 per dollar
Cryptocurrencies
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Bitcoin fell 0.3% to $29,558.48
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Ether was little changed at $1,918.57
Bonds
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This story was produced with the help of Bloomberg Automation.
–With assistance from Wildana Hajrik and Carly Vanna.
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