Asia shares poised for seventh straight month of gains
Asian stocks are poised for a seventh consecutive month of gains on Friday after upbeat earnings from Amazon and Apple boosted Wall Street futures and the dollar hovered near three-month highs on uncertainty about further Fed rate cuts.
Nasdaq futures gained 1.2 percent and S&P 500 futures gained 0.6 percent as Amazon’s stellar earnings soared shares a staggering 13 percent after the bell. Apple also rose 2.3 percent after the outlook for iPhone sales beat forecasts.
This overnight offset pressure from Meta and Microsoft amid concerns about rising AI spending. Six of the US’s “Magnificent Seven” tech megacorporations have reported, and the results are mixed. Nvidia, the world’s top US$5 ($7.6) trillion company, is expected to report in three weeks.
“Things have turned around, or at least pulled back a little bit, with Apple and Amazon’s earnings this morning…improving sentiment for Asian business,” said Kyle Rodda, a senior analyst at Capital.com.
“While the week’s big events are now in the rearview mirror, markets still finished the week on uncertain ground. The report card… isn’t categorically positive, but it’s not all bad either.”
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2 percent on Friday; gains elsewhere were offset by losses in Chinese stocks. The index was preparing to increase by 1.8 percent weekly and 4.7 percent monthly.
Japan’s Nikkei index rose 1.1 percent on Friday, taking its weekly and monthly gains to 5.2 percent and 15.5 percent, respectively.
Chinese stocks fell in October after negative readings on China’s factory activity weighed on sentiment. The official purchasing managers’ index (PMI) fell to a six-month low of 49, well below the forecast of 49.6.
Chinese blue chips fell 0.4 percent and Hong Kong’s Hang Seng index fell 0.3 percent.
The highly anticipated summit between US President Donald Trump and Chinese President Xi Jinping led to the reduction of US tariffs on Chinese goods, Beijing’s resumption of US soybean purchases and the resumption of rare earth exports from China.
However, the market’s reactions were rather muted as the meeting was seen as merely a tactical ceasefire rather than a major reset in bilateral relations.
This week, major central bank meetings delivered decisions largely in line with expectations; The biggest surprise came from Federal Reserve Chairman Jerome Powell, who went against the market’s optimistic view of a December rate cut.
Treasuries were flat on Friday but poised for weekly losses. Two-year Treasury yields were steady at 3.6021 percent, up 12 basis points already this week, while 10-year Treasury yields were steady at 4.0931 percent, up 10 basis points throughout the week.
Although resistances remain heavy at 99.564 and 100.25, the rise in yields provided support to the US dollar, which is hovering near three-month highs at 99.459 against major currencies.
The euro was last up 0.1 per cent at US$1.1572 ($A1.7650) after the European Central Bank left interest rates unchanged at 2.0 per cent at its third consecutive meeting on Thursday and reiterated that policy was “in a good place” as economic risks receded.
Oil prices fell and headed for a third straight month of decline as strong commodity gains capped by the dollar and increased supply from major producers offset the impact of Western sanctions on Russian exports.
Brent crude futures were down 0.5 per cent at US$64.67 ($A98.63) per barrel, while US West Texas Intermediate crude was down 0.6 per cent at US$60.22 ($A91.85) per barrel.
Spot gold prices were up 2.4 per cent overnight at US$4,033.48 (A$A6,151.88) per ounce but fell almost 2.0 per cent over the week, well below the record of US$4,381 (A$A6,682) seen last week.
Australia’s Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national news channel and has been providing accurate, reliable and fast-paced news content to the media industry, government and corporate sector for 85 years. We inform Australia.
