Asian equities rally as US recession fears fade: Markets wrap
recession concerns, fueling a rally in stocks and sending bonds tumbling.
Equity benchmarks in Japan climbed over 2% at the open, while shares in Australia increased alongside those in South Korea. US futures contracts edged higher after the S&P 500 and tech-heavy Nasdaq 100 both rose, as retail sales data beat estimates and jobless claims hit the lowest since early July.
The Wall Street gains reflected an easing of worries that the US economy is heading into a recession. Global stocks have largely erased the losses seen last week on signs that the Federal Reserve is considering rate cuts.
The “stronger-than-expected retail sales figure quiets some of the fears the US may be slipping into a recession,” said Bret Kenwell at eToro. “Investors and consumers want inflation to go lower — but not at the expense of the economy.”
Treasuries in Asia were steady after a Thursday slump that tracked expectations for less aggressive Fed easing. Swaps market pricing now has three 25 basis point cuts priced in across the Fed’s remaining 2024 meetings, down from the four expected earlier in the week.
The surge in Treasury yields was led by shorter maturities, while 10-year yields rose eight basis points to 3.91%. An index of dollar strength was steady Thursday. The yen was also flat Friday after weakening against the greenback in the prior session to levels last seen at the start of the month.
Elsewhere in Asia, China’s central bank chief pledged further steps to support the country’s economic recovery, while cautioning that
