Marketmind: Rate hopes trump economic jitters
By Jamie McGeever
(Reuters) — A look at the day ahead in Asian markets.
Asian stocks are on track for their fourth weekly rise in a row if they can avoid falling more than 1% on Friday, which would mark the longest winning streak in over a year.
The regional and global backdrop for Asian markets on Friday looks relatively supportive, at least from an interest rate perspective, if not an economic one.
Figures on Thursday showed that Japan and Britain slipped into recession at the end of last year, and U.S. retail sales last month fell much more than expected. But the upshot of that could be relatively looser monetary policy.
That's how it played out on Wall Street and in Japan on Thursday — the Nikkei chalked up another 34-year high to come within 1,000 points of its all-time peak, as traders bet that Japan's shock slide into recession will force the Bank of Japan to go slow on normalizing monetary policy.
The Nikkei is the stock market darling of the year, up a staggering 14% since Jan. 1. The yen's fall through 150.00 per dollar to within sight of its recent 33-year low has been a key driver of the Nikkei's rally, but not on Thursday — it got swept along in the global wave of non-dollar currency appreciation.
Japan's GDP figures were remarkable, with the 0.4% annualized contraction in the October-December period deeper than even the gloomiest forecast in a Reuters poll of 16 economists. The consensus, meanwhile, was +1.4%.
Surprisingly weak U.S. retail sales data on Thursday also weighed on Treasury bond yields and the dollar, which was enough to keep Wall Street in the green for a second day.
Juiced by the ongoing tech and AI boom, and strength in recent earnings, the S&P 500 has risen 14 out of the last 15 weeks,
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