Asia shares, dollar look to U.S. infrastructure spree

By Wayne Cole SYDNEY (Reuters) - Asian shares inched higher and the U.S. held near multi-month peaks on Monday as the chance of yet more trillions in U.S.

Reuters March 29, 2021 07:05:55 IST
Asia shares, dollar look to U.S. infrastructure spree

Asia shares dollar look to US infrastructure spree

By Wayne Cole

SYDNEY (Reuters) - Asian shares inched higher and the U.S. held near multi-month peaks on Monday as the chance of yet more trillions in U.S. fiscal spending underpinned the outlook for global growth.

Optimism about the U.S. economy helped Wall Street rally late Friday, while by Sunday some 143 million vaccinations had been given to almost 94 million people.

President Joe Biden is expected to put some detail on his infrastructure spending plans on Wednesday, while payrolls on Friday are forecast to rise 630,000 amid chatter it could be a million or more.

"We expect the global economy to expand robustly at 6.4% this year, fuelled by a large U.S. fiscal stimulus, with positive spillovers for the rest of the world," said Barclays economist Christian Keller.

"Rising inflation over the coming months should be transitory, and core central banks seem committed to looking through it."

MSCI's broadest index of Asia-Pacific shares outside Japan nudged up 0.1%, with activity restrained by the approach of quarter end.

Japan's Nikkei added 1%, though there was some nervousness when Nomura reported it had discovered a loss at its U.S. unit that could amount to $2 billion.

There was also some caution after a $20 billion wave of block trades hit markets on Friday, reportedly linked to investment fund Archegos Capital.

For now, Nasdaq futures were off 0.4%, and S&P 500 futures 0.3%.

The prospect of faster U.S. economic growth has spurred speculation of rising inflation and weighed on Treasury prices. Yields on U.S. 10-year notes were up at 1.67%, and nearing the recent 13-month top of 1.754%.

European yields have been restrained by active buying from the European Central Bank, widening the dollar's yield advantage over the euro. The single currency was last at $1.1786, having hit a five-month low of $1.1760 last week.

Analysts at TD Securities noted the euro had failed to find any benefit from a very strong German IfO survey on Friday that showed business morale at a near two-year high and signs of recovery in the service sector.

"This suggests that market positioning still remains significantly skewed toward the long side in EURUSD — even though spot has seen a meaningful decline through the 200-day moving average," they wrote in a note. "We continue to focus on downside risks from here."

The dollar was also firm at 109.70 yen, having reached its highest since early June on Friday at 109.84. The dollar index stood at 92.776, after reaching its highest since mid-November.

The lift in yields has weighed on gold, which offers no fixed return, and left it at $1,730 an ounce.

Oil prices, and commodities in general, have been supported by speculation a blockage in the Suez canal could take weeks to clear, delaying oil shipments of a million barrels a day. There are now over 300 vessels waiting to pass through the shipping route which accounts for 12% of global trade.

The market will be cautious ahead of an OPEC meeting this week which will have to decide whether to extend supply limits, or loosen the spigots. [O/R]

Brent was off 7 cents at $64.50 in early trade, while U.S. crude dipped 24 cents to $60.73 per barrel.

(Editing by Richard Pullin)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

Venezuela and Colombia rights groups ask for U.N. envoy amid border violence
World

Venezuela and Colombia rights groups ask for U.N. envoy amid border violence

CARACAS (Reuters) - Human rights groups from Venezuela and Colombia on Wednesday called on the United Nations to appoint a special envoy to address the humanitarian crisis caused by clashes between Venezuelan troops and Colombian armed groups near the countries' border. Colombian officials estimate that some 4,000 people have fled Venezuela for Colombia since March 21 following a military offensive in Venezuela's Apure state.

Jailed Kremlin critic Navalny goes on hunger strike over lack of medical care
World

Jailed Kremlin critic Navalny goes on hunger strike over lack of medical care

By Anton Zverev and Andrew Osborn MOSCOW (Reuters) - Jailed Kremlin critic Alexei Navalny went on hunger strike on Wednesday in an attempt to force the prison holding him outside Moscow to provide him with proper medical care for what he said was acute pain in his back and legs. The fate of Navalny, one of President Vladimir Putin's most prominent critics, is in focus after he said last week that being woken up by a guard every hour during the night amounted to torture and that his appeals for medical treatment had been ignored. In a handwritten letter addressed to the governor of his prison which was posted to social media by his team on Wednesday, Navalny said daily requests for a doctor of his choice to examine him and for proper medicine had been ignored

Gbabgo could return to Ivory Coast after ICC upholds acquittal
World

Gbabgo could return to Ivory Coast after ICC upholds acquittal

By Stephanie van den Berg THE HAGUE (Reuters) - The International Criminal Court on Wednesday upheld its 2019 acquittal of former Ivory Coast President Laurent Gbagbo on charges of crimes against humanity during post-election violence and ordered all conditions of his release be removed. The decision may open the way for Gbagbo, 75, who has been living in Belgium, to return to Ivory Coast