China Bonds Gain as Biden Drops Out of the Race – Asia Market Wrap

After Joe Biden dropped out of the race for re-election and endorsed Vice President Kamala Harris, the Dollar fell and Treasuries increased. After the central bank lowered its policy interest rate, Chinese bonds saw an increase.

Following the People’s Bank of China’s decision to stimulate growth by lowering a short-term rate for the first time in over a year, the yield on China’s 10-year sovereign note fell by two basis points. In the second-largest bond market globally, foreign ownership hit a record 4.3 trillion yuan ($591 billion) in month, extending the buying spree of international investors to ten months.

Amidst weakness in the tech sector, Chinese equities fell, contributing to regional losses spanning from Japan to Australia. The decline in Taiwan Semiconductor Manufacturing reached 3.3%. US stock futures slightly increased.

A measure of the strength of the US dollar fell by 0.1%, and the yield on the 10-year Treasury fell by 2 basis points. Bitcoin hit its highest level in more than a month, while gold gained.