Asian stocks advance after Wall Street’s rebound: Markets wrap
Wall Street as investors looked beyond Joe Biden ending his reelection campaign to focus on the start of the tech earnings season.
The MSCI Asia Pacific Index snapped a three-day decline, as shares from Japan to South Korea and Australia rose at the open. That followed a 1.1% jump in the S&P 500, ahead of earnings from Tesla Inc. and Alphabet Inc. due later Tuesday.
Sky-high valuations and seasonal weakness have incited some stock pullback warnings, with traders also facing political uncertainties. Yet even with the many headlines that followed Biden’s decision to quit the race and endorse Kamala Harris, a sense of calm prevailed Monday. Volatility slumped as dip buyers emerged.
“This political shake-up shouldn’t materially alter the direction of the markets,” said Tom Essaye at The Sevens Report. “The ultimate direction of the S&P 500 will still be determined by economic growth.”
Almost two-thirds of respondents to Bloomberg’s Markets Live Pulse survey expect earnings to reinvigorate the US benchmark. A gauge of the “Magnificent Seven” climbed about 2.5%, led by gains in Tesla and Nvidia Corp. The Nasdaq Golden Dragon China Index, a gauge of US-listed Chinese shares, advanced 2.8%.
Treasury yields steadied ahead of this week’s readings on the economy as well as the Federal Reserve’s preferred inflation gauge. For much of July, bets on a rate cut in September drove shorter-term bonds up — narrowing the gap with longer-dated maturities.
Australian bond yields advanced, while the currency was little changed
