(Bloomberg) — U.S. Treasuries fell on Friday after Federal Reserve Chairman Jerome Powell said policymakers would likely wait beyond March to cut interest rates. The range of decline widened. Chinese stocks rose on signals of official support.
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U.S. 10-year bond yields rose about 5 basis points in Asia after rising 14 basis points on Friday following better-than-expected jobs data. “The danger of acting too soon is that the job is not yet done,” Powell said in an interview on CBS’ 60 Minutes program, which aired in the US on Sunday.
The fall in Treasuries sent ripples through Asian bond markets and weighed on government debt in Australia and New Zealand. Chinese government bonds were an outlier, with 10-year bond yields falling by about 2 basis points.
Hong Kong and mainland China stocks are on the rise after the China Securities Regulatory Commission issued a new statement on Monday, pledging to closely monitor and take effective measures to prevent stock collateral risks. It has risen from the previous decline. The committee said on Sunday it would act to prevent abnormal volatility and direct more medium- and long-term funds into the market.
“It remains to be seen whether today is the bottom for Chinese stocks, but it feels like a bottom has been reached, indicating that policymakers don’t want them to fall any further,” said strategist David Chao. That’s for sure,” he said. At Invesco Asset Management.
Benchmarks in Australia and South Korea also fell, and U.S. stock futures also fell after the S&P 500 index rose 1.1% to a new record on Friday. The strong performance of U.S. benchmarks continues as February, historically one of the most eventful months of the year for U.S. stocks, begins.
The dollar strengthened against most of its major peers after Powell’s hawkish comments. The yen gradually depreciated, trading at around 148 yen to the dollar.
Investor bets on the Fed cutting interest rates in March fell from nearly 40% on Thursday to around 20% on Friday, as the economy’s resilience reduces the likelihood of imminent policy easing.
Ed Yardeni, president of Yardeni Research, said in a note that even though the outlook for a rate cut in March has weakened, “the market still expects five rate cuts this year.” “Fed officials will continue to push back against the idea of significantly lower interest rates.”
Oil prices rose as the US announced further strikes against Iranian forces and its proxies, while the Houthis vowed to retaliate for the weekend’s shelling. Gold has weakened.
Former US President Donald Trump also signaled he could impose tariffs of more than 60% on Chinese goods if elected, in another hawkish statement aimed at the US’s largest supplier of goods.
This week’s main events:
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Eurozone S&P Global Services PMI, PPI, Monday
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Australian interest rate decision Tuesday
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Eurozone retail sales Tuesday
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Order from German factory, Tuesday
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Cleveland Fed President Loretta Mester and Philadelphia Fed President Patrick Harker speak on Tuesday
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Bank of England Deputy Governor Sarah Breeden speaks on Wednesday
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Fed President Adriana Kugler and Richmond Fed President Tom Barkin speak on Wednesday
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China PPI, CPI, Thursday
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pakistan general election thursday
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ECB Chief Economist Philippe Lane and ECB Governing Council Member Pierre Wunche speak on Thursday
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European Central Bank releases economic update on Thursday
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U.S. new unemployment claims, Thursday
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U.S. Treasury Secretary Janet Yellen speaks at a Senate Banking Committee hearing Thursday
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Reserve Bank of Australia Governor Michelle Bullock will testify to Parliament on Friday.
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China’s comprehensive lending, money supply, new yuan lending, Friday
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German Consumer Price Index, Friday
The main movements in the market are:
stock
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S&P 500 futures were down 0.2% as of 2:32 p.m. Tokyo time. The S&P 500 rose 1.1% on Friday.
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Nasdaq 100 futures fell 0.3%.Nasdaq 100 rose 1.7%
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Japan’s TOPIX rose 0.7%
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Hong Kong’s Hang Seng rose 0.8%
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The Shanghai Composite fell 0.1%.
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Euro Stoxx50 futures little changed
currency
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Bloomberg Dollar Spot Index rose 0.2%
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The euro was almost unchanged at $1.0779.
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The Japanese yen remained almost unchanged at 148.37 yen to the dollar.
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The offshore yuan was little changed at 7.2109 yuan to the dollar.
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The Australian dollar was almost unchanged at US$0.6511.
cryptocurrency
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Bitcoin fell 0.3% to $42,640.83.
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Ether fell 0.4% to $2,289.58.
bond
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The 10-year Treasury yield rose 5 basis points to 4.07%.
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Japan’s 10-year bond yield rose 6 basis points to 0.720%.
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The Australian 10-year bond yield rose 12 basis points to 4.10%.
merchandise
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West Texas Intermediate crude rose 0.6% to $72.73 per barrel.
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Spot gold fell 0.4% to $2,031.44 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Richard Henderson and Charlotte Yang.
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