Asian Stocks Drift; Treasuries, Dollar Steady: Markets Wrap

Bloomberg.com — Asian stocks drifted Tuesday as risk appetite remained subdued and the earnings season continued. The yen edged higher, while the dollar and Treasuries were little changed.

Equity benchmarks ticked higher in Japan and Korea with Australian shares posting declines with trading volumes below their 30-day averages. Hong Kong and Chinese stocks outperformed as investors deemed the nation’s equities cheap after the recent sell-off. A Reuters report that the Bank of Japan had considered raising interest rates this year helped the yen gain.

Earlier, the S&P 500 Index closed at its highest since January as Berkshire Hathaway Inc. bolstered financial shares and higher oil prices boosted energy producers. The yield on 10-year Treasuries held below 3 percent and the Cboe Volatility Index fell to its lowest since Jan. 26.

Investors largely shrugged off early concern sparked by China’s signal it won’t flinch in a trade war, adding to heightened rhetoric from U.S. President Donald Trump. Meanwhile, geopolitical concerns continue to lurk in the background with confusion about the status of negotiations intended to lead to the denuclearization of the Korean peninsula and the Trump administration moving to restore some U.S. sanctions on Iran.

Elsewhere, the pound was little changed after weakening to an 11-month low on Brexit angst. Turkey’s lira advanced after sinking to a record low as heightened concern over a diplomatic spat with the U.S. overshadowed the central bank’s attempt to support the currency. U.S. crude traded around $69 a barrel after Saudi Arabian production cuts heightened concerns about tightening worldwide supplies.