SYDNEY: The US dollar held near 14-year peaks today as global yield spreads moved inexorably in its favour, while a falling yen lifted Japanese shares to some one-year top.
The Nikkei added 0.3% in thin trade, while Australia’s main index climbed 0.6% for your highest in 17 months after Wall Street racked up more records.
Japan’s government upgraded its overall assessment from the economy today, echoing a more upbeat view within the Bank of Japan’s delivered the previous day.
The dollar revelled in their rapidly widening yield premium, when using the Federal Reserve set on a tightening course as its peers in Europe and Japan act to keep their short-term rates deep in negative territory.
The dollar index, which measures it against a basket of currencies, stood at 103.100 having touched 103.65, its highest since December 2002.
The US currency did run across scattered profit-taking because session wore which eased it here we are at 117.64 yen, but remained on the horizon from the recent peak at 118.66. The euro would be a fraction firmer at US$1.0413.
On Wall Street, the Dow ended just 25 points shy with the magical 20,000 barrier helped by way of 1.68% get more Goldman Sachs.
Stocks have been getting a tear for the reason that Nov 8 presidential election, with the Dow up 9% along with the S&P 500 6% on bets that President-elect Donald Trump’s plans for deregulation and infrastructure spending might boost profits and growth.
The Dow rose 0.46% yesterday, as you move the S&P 500 gained 0.36% plus the Nasdaq 0.49%. Eight of your 11 major S&P sectors rose, led by a 1.23% begin the financial index.
After the bell, Nike rose 3% using a strong queensland through the sports apparel seller.
European shares scaled 11?month highs on Tuesday as Italy’s banking index rose 2.Three percent as soon as the government chosen to seek parliamentary approval to borrow 20 billion euros to underwrite the steadiness of the banks.
Emerging markets are not as thrilled by Trump’s win, when the threat of tariffs has stirred fears on the trade war while rising US yields have attracted funds away.
Benchmark 10-year US yields have climbed almost 80 basis points since early November to attain 2.57%.
Data through the Institute for International Finance showed non-resident investors had pulled US$23 billion from emerging market portfolios since early October.
The outflows have triggered the longest continuous “reversal alert” since the organisation began issuing the notice in 2005.
Chinese markets was unsettled by Beijing’s go on to heighten supervision of shadow banking activities and also on talk this could tighten liquidity to retard an outflow of capital.
MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.3% today, but to come a string of losses.
In commodity markets, oil prices nudged higher for any fourth session on expectations data due later in the day would show a US crude inventory draw.
US crude futures were up 32 cents at US$53.62 a barrel, while benchmark Brent crude futures added 26 cents to US$55.61.
Gold held at US$1,133.80 an ounce for a firm US dollar kept it pinned near last week’s 10-1/2-month low of US$1,122.35.