Precise Investors Editorial Team
Equity futures in Japan pointed to a flat open, while financial markets in Australia and Hong Kong remain shut
Asian stocks are set for a muted open with several regional markets still closed for holidays. Sentiment may remain generally positive after US shares extended this year’s gain on Wednesday.
Equity futures in Japan pointed to a flat open, while financial markets in Australia and Hong Kong remain shut. Most markets in US and Europe were closed Thursday for Christmas Day.
Equity bulls are pinning their optimism on the so-called “Santa Claus Rally” to push stocks to new records even as exuberance over artificial intelligence and the Federal Reserve’s interest-rate path are being questioned. The rally is traditionally seen as taking place on the final five trading sessions of a year and the first two of the new one.
As equity markets enter the fourth year of a bull market, our underlying market call remains constructive, Scott Chronert, head of US equities strategy at Citigroup Inc. wrote in note this week. The current fundamental backdrop clearly has the opportunity for an ongoing AI-related tailwind to large cap growth.
The S&P 500 Index gained for a fifth day Wednesday in a shortened session ahead of the Christmas holiday. The VIX index of the S&P 500’s expected volatility dropped to the lowest this year. The Treasury 10-year yield dropped three basis points to 4.13%.
The yen was little changed Friday ahead of national jobs data and the Tokyo inflation rate that may give a further clue on the timing of any more Bank of Japan rate hikes. The currency dropped last Friday when the BOJ raised rates but sounded cautious about future tightening.
Yuan strengthened past the 7 per dollar in offshore trading Thursday for the first time since September 2024, on speculation the central bank will allow gradual currency appreciation to boost market confidence. The move came after the People’s Bank of China strengthened its daily reference rate to the strongest level since September 2024.
In commodities, gold steadied Wednesday after a rally that took the precious metal to an all-time high above $4,500 an ounce.
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