Japan’s Nikkei soared 1.6 per cent, Australia’s stock benchmark climbed 1.4 per cent and South Korea’s KOSPI gained 0.56 per cent
Asia-Pacific equities gained on Wednesday as bets strengthened for a peak in interest rates among major central banks globally, as bond yields continued to drop.
Japanese government bond yields slipped to the lowest since mid-August as U.S. Treasury yields stayed near a three-month low.
Meanwhile, crude oil dipped to around five-month low, while bullion held steady after dropping back from an all-time high. Bitcoin traded just below $44,000 after its surge this week to a 20-month high.
U.S. 10-year Treasury yields held steady at nearly 4.186 per cent after hitting 4.163 per cent on Tuesday as cooling labour market data strengthened views that the Fed is done raising rates, with bets on a first cut coming by March now at nearly 64 per cent, shows the CME Group’s FedWatch tool.
Benchmark JGBs yields slipped, touching the lowest since August 16 at 0.62 per cent.
Japan’s Nikkei soared 1.6 per cent, bouncing back from Tuesday’s mid-November low, while Australia’s stock benchmark climbed 1.4 per cent and South Korea’s KOSPI gained 0.56 per cent.
U.S. stock futures also pointed higher, with the tech-heavy Nasdaq indicated up 0.4 per cent after a 0.31 per cent gain overnight for the cash index. S&P 500 futures gained 0.26 per cent, after the cash index closed Tuesday flat.
Overnight, U.S. jobs data came in softer than expected, but coupled with robust services data, added to the narrative for a soft landing for the economy as the Federal Reserve shifts to monetary easing, analysts said.
The “selloff in yields across the curve is strong evidence of the intense focus the market has on this week’s labour market data,” with the ADP employment report due later on Wednesday and non-farm payrolls on Friday, said IG analyst Tony Sycamore.
Chinese equities underperformed on Wednesday, with sentiment fragile after ratings agency Moody’s issued a downgrade warning on China’s credit rating.
Hong Kong’s Hang Seng gained 0.41 per cent, supported mainly by a rally in tech, with a sector subindex jumping around 1 per cent.
Mainland Chinese blue chips were flat.
Gold was flat just below $2,020, declining after its surge to a record $2,135.40 on Monday.
Crude eased further on Wednesday, weighed down by the worsening demand outlook from China, and doubts about the impact of OPEC cuts.
