Asian Stocks Fluctuate Into Holiday, Yields Slip: Markets Wrap

(Bloomberg) — Stocks in Asia held in a narrow range on Thursday while bond yields slipped as traders took to the sidelines ahead of the US Thanksgiving holiday.

Shares in Japan swung between gains and losses while those in Australia climbed alongside Hong Kong equity futures. Contracts for US stocks edged up after the S&P 500 fell 0.4% Wednesday, retreating from a record high in the prior session. The Nasdaq 100 dropped 0.9% as tech stocks weighed on the US market. Nvidia Corp. and Tesla Inc. were among the hardest hit big-tech companies.

Selling in US stocks was accompanied by buying in Treasuries on Wednesday as investors sought the safety of US government debt, pushing the 10-year yield as low as 4.22%. Australian and New Zealand yields fell early Thursday, echoing the moves. Asian trading of Treasuries will be closed on Thursday to observe the Thanksgiving holiday.

The yen edged lower early Thursday after climbing more than 1% against the greenback to trade at its strongest since late October. A gauge of dollar strength steadied on Thursday after falling 0.7% on the previous day.

In a thin trading session ahead of the holiday, data showed the Fed’s preferred measure of underlying inflation picked up. While in-line with estimates, the core personal consumption expenditures climbed 2.8% from October last year. Separate figures showed the economy expanded at a solid pace. 

The data support recent comments by many Fed officials that there’s no rush to cut rates as long as the labor market remains healthy and the US continues to power ahead. 

“The last mile towards price stability has been stymied by still ‘sticky’ inflation and bumps along road,” said Quincy Krosby at LPL Financial.

Elsewhere, shares in Microsoft Corp. declined on Wednesday after the US Federal Trade Commission opened an antitrust investigation of Microsoft Corp., drilling into everything from the company’s cloud computing and software licensing businesses to cybersecurity offerings and artificial intelligence products.

In Asia, the Bank of Korea is anticipated to hold rates at 3.25%, pausing its policy moves after the first cut in over four years last month.

Investors will also be on the lookout for further moves in Chinese equities after a Wednesday rally on speculation that a key economic meeting expected next month may lead to more stimulus. The Golden Dragon index of US-listed Chinese companies jumped 2.8%.

Tech Shares

US stocks have extended their outperformance against international peers this year, powered by tech shares and the artificial intelligence frenzy, while the economy remains resilient.

The S&P 500 has climbed over 25% in 2024, making numerous record highs and largely outpacing the MSCI World Ex-USA Index. The valuation gap has also widened, with US stocks now trading at a record 60% premium to international peers based on forward price-to-earnings ratios.

Elsewhere, BlackRock Inc., Vanguard Group Inc. and State Street Corp. were sued by a group of states led by Texas for allegedly breaking antitrust law by boosting electricity prices through their investments.

In commodities, oil steadied as OPEC+ was expected to delay a production restart. Gold eked out small gains. Meanwhile, Bitcoin traded around $96,000 after a rally on Wednesday.

Key events this week:

• Eurozone consumer confidence, Thursday
• US Thanksgiving holiday. Markets closed, Thursday
• Eurozone CPI, Friday
• ECB releases consumer expectations survey for October, Friday
• “Black Friday,” the traditional start of the US holiday shopping rush

Some of the main moves in markets:

Stocks

• S&P 500 futures rose 0.1% as of 9:28 a.m. Tokyo time
• Hang Seng futures rose 0.1%
• Japan’s Topix was little changed
• Australia’s S&P/ASX 200 rose 0.5%
• Euro Stoxx 50 futures fell 0.6%

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.0561
• The Japanese yen fell 0.2% to 151.46 per dollar
• The offshore yuan was little changed at 7.2464 per dollar
• The Australian dollar was little changed at $0.6501

Cryptocurrencies

• Bitcoin fell 0.4% to $96,031.46
• Ether rose 0.3% to $3,648.59

Bonds

• Australia’s 10-year yield declined three basis points to 4.39%

Commodities

• West Texas Intermediate crude rose 0.1% to $68.82 a barrel
• Spot gold was little changed

This story was produced with the assistance of Bloomberg Automation.

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