Asian Stocks Edge Higher; Oil Holds Gains: Markets Wrap

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(Bloomberg) — The global equity rally marched on in Asia Tuesday and bonds declined further as investors took comfort from progress on the Covid-19 vaccine rollout. Oil held an overnight gain as freezing temperatures in the U.S. roiled energy markets.

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Japan’s Nikkei 225 Stock Average jumped more than 1% to cement a move above 30,000. Stocks in Australia and South Korea saw more modest gains, while Hong Kong shares advanced after a holiday. S&P 500 contracts pointed higher. Earlier, European stocks climbed led by the U.K. after it hit a vaccination milestone. U.S. markets were closed for Presidents’ Day on Monday and Chinese markets remain shut for the Lunar New Year holiday.

Ten-year Treasury yields jumped to 1.24%, their highest in almost a year, and Australian equivalents edged up. An Arctic blast in the U.S. threatened to disrupt energy supplies, and crude oil traded around a 13-month high. Texas began rolling power blackouts for millions of households for the first time in a decade and traders estimate a few hundred thousand barrels a day of output in the state may be impacted by well shutdowns, traffic jams and power outages.

© Bloomberg MSCI World Index’s price-to-earnings ratio is at the highest level since 2009

Global equities look set to rise for a twelfth straight session to another all-time highs and the Treasury yield curve is testing its steepest levels in more than five years as traders bet on improving growth and benign inflation. Investors see a combination of government spending and vaccines driving the economy out of the pandemic.

“Yields are a long way off causing damage to growth or the equity market outlook,” Chris Iggo, chief investment officer of core investments at Axa Investment Managers, said in a note. “Earnings are growing and secular themes are driving returns. However, complacency is dangerous.”

Read: JPMorgan’s Barometer Says Markets Most Complacent in Two Decades

Elsewhere, Bitcoin traded around $48,000 after hitting a record in weekend trading.

Here are some key events coming up:

Earnings roll on with companies including, BHP Group, Daimler, Credit Suisse, Deere, Danone and Nestle.Reserve Bank of Australia releases minutes from February policy meeting.Euro-area finance ministers will discuss the bloc’s current economic situation and outlook on Tuesday.Federal Open Market Committee minutes from the January meeting are due Wednesday.U.S. retail sales figures come on Wednesday.

These are the main moves in markets:

Stocks

Futures on the S&P 500 Index increased 0.6% as of 10:33 a.m. in Tokyo.Topix index rose 0.7%. Nikkei 225 gained 1.2%.Australia’s S&P/ASX 200 Index gained 0.6%.South Korea’s Kospi index added 0.6%.Hong Kong’s Hang Seng Index rose 1.7%.Euro Stoxx 50 futures rose 0.1%.

Currencies

The yen fell 0.2% to 105.54 per dollar.The offshore yuan was little changed at 6.4025 per dollar.The Bloomberg Dollar Spot Index dipped 0.1%.The euro rose 0.1% to $1.2142.The British pound rose 0.2% to $1.3936.

Bonds

The yield on 10-year Treasuries rose four basis points to 1.25%.Australia’s 10-year bond yield rose one basis point to 1.33%.

Commodities

West Texas Intermediate crude gained 1% to $60.08.Gold rose 0.3% to $1,823.41 an ounce.

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