Asian stocks higher on Friday after a top Federal Reserve

Asian stocks edged up on Friday after Federal Reserve official cemented expectations of a U.S. interest rate cut later this month, fuelling appetite for riskier assets and keeping a cap on the dollar.

Asian Stocks

The Euro Stoxx 50 futures were rose 0.63%, German DAX futures traded at 0.63% and Britain’s FTSE futures gained 0.46%.

In oil markets, crude surged after the United States said its navy destroyed an Iranian drone in the Strait of Hormuz, a major choke point for global crude flows, raising concerns about supply disruptions out of the region.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 1%, after previous day’s losses, while Japan’s Nikkei rose 2%.

Policymakers could not wait for economic disaster to hit before adding stimulus, in a speech read as a strong argument in favor of quick monetary action, New York Fed President John Williams (NYSE:WMB) said on Thursday.

The comments by Williams made it a virtual certainty the Fed would cut interest rates by 25 basis points (bps) at its July 30-31 policy meeting and also revived expectations of an even deeper 50 bps reduction.

The Shanghai Composite Index advanced 0.8%, Australian stocks added 0.75% and South Korea’s KOSPI rose 1.4%.

In currency markets, the dollar index against its six major currencies was little changed at 96.841 after falling roughly 0.5%.

The dollar was 0,3% at 107.620 yen, crawling away from a three-week through of 107.210 on Thursday after the New York Fed’s clarification of Williams’ comments.

The euro fall 0,15% and traded at  $1.1258.

In bonds, U.S Treasury yields were lower. The 2-year yield was at 1.7894%  and the 10-year yield declined to a 10-day trough of 2.023% and was last at 2.0465%.

U.S crude oil futures reversed back by rising 1.45% to $56.10 per barrel.

Spot gold was at $1,452.60 an ounce.

Related Posts