Global Stocks Rally; Dollar Weakens Ahead of US Shutdown – Asia Market Wrap
US and European equity-index futures rose alongside Asian shares, signaling Wall Street’s advance after an in-line inflation reading may extend.
Contracts for the S&P 500 and the Nasdaq 100 rose 0.3% after both indexes gained on Friday, snapping three days of declines. European stocks were also set for a stronger open. Asian shares erased earlier losses to advance 0.4% with Hong Kong jumping 1.4%. Japanese shares fell as ex-dividend stocks weighed on the benchmarks.
Crude oil fell 0.4% as people familiar with the plans said that OPEC+ will weigh a November supply increase exceeding the 137,000 barrel- a-day hike scheduled for October. Gold rose to a record. A gauge of the dollar headed for a second day of declines, weighed down by month-end flows and the risk of a US government shutdown. Treasuries rose.
Top congressional leaders plan to meet with President Donald Trump on Monday, just a day before federal funding runs out if lawmakers can’t agree on a short-term spending bill. The measure, which would only fund the government until mid-November, must pass by Oct. 1 to avert a shutdown that could delay key economic data and unsettle markets.
US Stocks saw dip buying on Friday while the Treasury yield curve marginally steepened as the personal consumption expenditures price index, the Fed’s preferred measure of inflation, came in as expected.
Traders maintained expectations of a high likelihood the central bank will cut the funds rate again next month in a bid to help bolster a cooling labor market, according to swaps data.
Elsewhere this week, the Reserve Bank of Australia is expected to keep interest rates on hold, with traders parsing Governor Michele Bullock’s comments for clues to whether the central bank will cut again. Chinese factory and services activity readings are due as well.
