(Bloomberg) -- Stocks in Asia were likely heading for a cautious start Monday after the best week since mid-December, with investors continuing to monitor the rising coronavirus death toll. Currencies were largely steady in early trading.
The S&P 500 Index fell along with Treasury yields on Friday, when futures on equities in Hong Kong and Japan declined. Australian contracts were flat. Investors are taking stock of a large rally that last week propelled global stocks back to all-time highs. Meantime, the coronavirus has now killed more people than SARS and a cruise ship in Japan with 70 victims has the most infections outside China.
As investors grapple with assessing the impact of the virus on global growth, China’s central bank on Monday will offer its first batch of special re-lending funds as it seeks to combat the outbreak. Companies have limited operations in China and the Nikkei reported Hon Hai Precision Indistry Co., Apple Inc.’s main iPhone production partner also known as Foxconn, dropped plans to resume production after Chinese authorities intervened.
“Perhaps more worrying for global markets is the increasing number of coronavirus cases outside of China and Asia,” said Simon Ballard, chief economist and strategist at First Abu Dhabi Bank. “For now though, while coronavirus concerns may act as an anchor for near-term global growth expectations -- and therefore by extension, for global monetary policy -- the continued assumption for a ‘low for longer’ rates environment is helping underpin the bid for risk.”
Here are some key events coming up:
China inflation data comes Monday. Producer prices probably were flat in January from a year ago, according to forecasts, after six months of declines.Earnings season continues with reports including: Alibaba, Softbank, Nissan, Airbus, Nestle and AIG.Federal Reserve Chairman Jerome Powell delivers his semiannual testimony in Congress on Tuesday and Wednesday.Thursday brings a gauge of underlying U.S. inflation, the core consumer price index. It’s expected to increase to 0.2% in January, a faster pace than in December.China and the U.S. on Friday lower tariffs on billions of dollars of respective imports, as part of the trade deal signed last month.
And these are the main moves in markets:
Stocks
The S&P 500 fell 0.5% on Friday.Futures on Japan’s Nikkei 225 declined 0.9%.Hang Seng Index futures retreated 1.1%.Futures on Australia’s S&P/ASX 200 Index added 0.1%.
Currencies
The yen added 0.1% to 109.68 per dollar.The offshore yuan held at 7.0076 per dollar.The euro bought $1.0948, little changed.
Bonds
The yield on 10-year Treasuries fell six basis points to 1.58% on Friday.
Commodities
West Texas Intermediate crude oil fell 1.2% to $50.32 a barrel on Friday.Gold added 0.2% to $1,570.44 an ounce on Friday.
--With assistance from Sydney Maki.
To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net
To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Andreea Papuc
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https://finance.yahoo.com/news/stocks-start-week-caution-big-213747151.html
2020-02-09 21:37:00Z
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