Here's what Asia will be waking up to soon, not a pretty picture.
In summary:
U.S. equity markets:
Nasdaq gains 0.2%, while broader indices decline... Nvidia’s plan to resume AI chip sales to China (ForexLive gave the heads up on this yesterday) lifted sentiment ... Tech is the only S&P 500 sector to finish higher.
Russell 2000 small cap index drops 1.7%.
Global bond yields rise (Japan notably so ... ):
Japanese 10-year yield hits 1.595%, highest since 2008.
Japanese 20-year and 30-year yields hit record highs at 2.65% and 3.20%.
U.S. 30-year Treasury yield rises back above 5.00%.
Dollar strength:
Dollar index rises for the seventh straight session, best streak since October 2023.
Global equities hit record highs before dropping back:
Despite rising inflation and bond yields, Nasdaq, FTSE 100, and MSCI World Index touch new peaks.
Market sentiment weakens through the session:
U.S. inflation data broadly in line, but investors focus on upside risks.
Positive bank earnings fail to lift financial sector.
Investor concerns grow over fiscal and inflation risks:
Worries resurface about government debt, tariffs, and inflationary pressures.
Rising bond yields cast a shadow over equities.
Japan political risk adds pressure:
Investor anxiety ahead of Japan’s Upper House election, this weekend (Japan election jitters rattle bond market as investors brace for fiscal shift).
PM Ishiba’s approval ratings drop; risk of coalition shake-up or resignation looms.
Yen weakens despite higher Japanese yields:
Rising yields fail to support yen due to concerns over fiscal strain, Bank of Japan constraints, and stagflation fears.
This could very well be a VERY interesting Asia session! Like a Chinese curse interesting, that is ;-)
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Check out the weak yen:
