In Asian Equity Markets stocks moved up in early trade, with other Asia markets following, after U.S. Federal Reserve Chairman Jerome Powell signaled overnight that the U.S. central bank could be cutting interest rates soon. The Shanghai composite added 0.82%, while Hong Kong’s Hang Seng index advanced 1.2%. The Nikkei 225 rose 0.3% in morning trade. Shares of game maker Nintendo jumped more than 3.5% a day after the company announced a cheaper version of its Switch video game console.
In Currency Markets the U.S. dollar was soft on Thursday after Federal Reserve Chairman Jerome Powell set the stage for a rate cut later this month, vowing to “act as appropriate” to ensure the world’s biggest economy will be able to sustain a decade-long expansion. The euro traded at $1.1260, little changed in early Asia after having gained 0.38% the previous day. The dollar dipped 0.1% to 108.31 yen, extending its slide from a six-week high of 108.99 set on Wednesday before Powell’s testimony.
In Commodities Markets U.S. oil futures hit their highest in over a month on Thursday as a potential hurricane threatened crude output in the Gulf of Mexico and as an incident involving a British tanker in the Middle East highlighted ongoing tensions there. U.S. West Texas Intermediate (WTI) crude futures were up 11 cents at $60.54 a barrel, after earlier touching the highest since May 23 at $60.63. They gained 4.5% in the previous session. Brent crude futures were down 5 cents, or 0.1%, at $66.96 a barrel, after ending Wednesday up 4.4%.
In US Equity Markets stocks closed higher and the S&P 500 index briefly crossed the 3,000-point mark for the first time on Wednesday as remarks by Federal Reserve Chairman Jerome Powell reassured investors about the potential for an interest rate cut later this month. The S&P 500 gained 0.45%, to 2,993.07 and the Nasdaq Composite added 0.75%, to 8,202.53. The S&P 500 index of financial shares including banks, which tend to benefit in a higher interest rate environment, retreated 0.5% after Powell’s comments.
In Bond Markets the U.S. Treasury yield curve steepened on Wednesday after the Federal Reserve’s concerns about global growth increased expectations that the U.S. central bank may cut rates more sharply than expected in July. The two-year Treasury yield, a proxy for market sentiment about interest rate policy, was last 7.7 basis points lower at 1.828%. While yields on short-dated notes fell, those on longer maturities rose, steepening the yield curve and ending a multi-day flattening trend.