The Nasdaq composite rose 43 points, or 0.9 percent, to 5,000. News that Prime Minister Shinzo Abe will order his cabinet to compile economy-spurring measures also boosted investor sentiment.
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The dollar index (DXY00 +0.10%) is up +0.34 (+0.35%) this morning while EUR/USD (^EURUSD) is down -0.0008 (-0.07%) and USD/JPY (^USDJPY) is sharply higher by +1.78 (+1.77%). While Andrea Leadsom’s exit removes the need for a drawn-out leadership contest, investors remain uncertain about May’s approach to negotiating Britain’s exit from the European Union and whether she will call a general election to cement her authority.
In early Asia, the dollar changed hands at 102.52 yen, down 0.25 percent from late USA levels.
Asian stocks rose to a 2-1/2-month peak on Tuesday, a day after Wall Street shares hit a record high thanks to a combination of upbeat United States data and expectations of more stimulus from global policymakers.
Oil prices fell to a two-month low on extended selling after the market’s break below a key technical support level last week due to oversupply fears.
The numbers, which followed a very weak May report, lifted the U.S. S&P 500 index to within a few points of record highs but also pushed short-dated yields on slightly increase prospects of a rise in Federal Reserve interest rates this year. The Bank of Japan is expected to provide additional easing to keep interest rates low and the yen weak to make sure stimulus spending can gain traction. Britain’s FTSE 100 added 1.4 percent. It slid 0.1 percent to 113.84 against the euro.
Against this backdrop, the dollar rose 2.2 percent against the yen to 102.68 JPY= on Monday, marking its biggest daily gain since October 2014.
The Dow Jones industrial average .DJI closed up 80.19 points, or 0.44 percent, at 18,226.93.
U.S. Treasury yields rose on Monday after Japan prepared a new round of stimulus, boosting stocks and reducing demand for safe-haven U.S. bonds, and after the U.S. government sold new three-year notes to tepid demand.
Sato sees the probability of some market players selling into the dollar’s rally against the yen but believes that the dollar could increase its gains if upcoming US economic data and comments from Federal Reserve officials appear to favor a Fed interest rate rise in September.
Europe’s STOXX 600 index rose 0.6 percent, led higher by a more than 5 percent gain for German steelmaker ThyssenKrupp after it said it was in talks with Tata Steel about sector consolidation.
USA gold futures for August delivery settled down 0.1 percent at $1,356.6 per ounce. But some investors think the worst is over as oil prices stabilize, the jobs market strengthens and consumers start spending more. Brent crude, a standard for global oil prices, lost 16 cents to $46.59 a barrel in London. Benchmark 10-year yields were last at 1.432 percent, from a yield of 1.365 percent late Friday. The session low was $45.90, the lowest since May 11.
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Benchmark Brent crude and USA crude prices hit two-month lows of $45.90 a barrel and $44.53 a barrel, respectively, on extended selling after the market’s break below a key technical support level last week due to oversupply fears. Neither EconoTimes nor its third party suppliers shall be liable for any errors, omissions or delays in content, or for any actions taken in reliance thereon.
