Asian stocks hover seven month high, oil near USD 70 per barrel mark


Devdiscourse News Desk | Updated: 03-04-2019 07:07 IST | Created: 03-04-2019 06:44 IST
Asian stocks hover seven month high, oil near USD 70 per barrel mark
On Tuesday, the Dow Jones Industrial Average fell 0.3 per cent to 26,179.13 points, the S&P 500 was flat and the Nasdaq Composite added 0.25 per cent to 7,848.69. Image Credit: PxHere

Asian shares hovered near seven-month highs early on Wednesday as global investors paused for breath after the strong rally seen earlier this week, while oil approached the key $70 per barrel mark.

MSCI's broadest index of Asia-Pacific shares outside Japan was up less than 0.1 per cent early in the Asian trading day. The index jumped more than 1 per cent on Monday on data showing a return to growth for Chinese factory activity, while investor sentiment was further bolstered by improvements in U.S. manufacturing and construction spending. The benchmark inched up to a seven-month high on Tuesday amid a global run of gains that have pushed MSCI's key gauge of global equities to a six-month high. The global index was up less than 0.1 per cent on Wednesday morning, following small gains on Wall Street overnight.

Australian shares were up 0.6 per cent, while Japan's Nikkei stock index added 0.2 per cent. On Tuesday, the Dow Jones Industrial Average fell 0.3 per cent to 26,179.13 points, the S&P 500 was flat and the Nasdaq Composite added 0.25 per cent to 7,848.69.

"After such a strong rise it is no surprise that the risk rally stalled a little," Greg McKenna, strategist at McKenna Macro. The consolidation in risk sentiment was reflected on Wednesday in easing yields U.S. Treasury yields.

Benchmark 10-year Treasury notes yielded 2.4706 per cent, down from a U.S. close of 2.479 per cent on Tuesday. The two-year yield watched as a proxy for expectations of Fed rate rises, touched 2.2983 per cent compared with a U.S. close of 2.308 per cent. Oil prices also stood near multi-month highs amid concerns over supply, with Brent crude up 0.45 per cent at $69.68, close to its highest level so far in 2019 and near the key level of $70 per barrel.

U.S. West Texas Intermediate (WTI) crude was flat at $62.57 a barrel. News that the United States is considering more sanctions against Iran, the fourth-largest producer in the Organization of the Petroleum Exporting Countries (OPEC) and the halting of production at a crude terminal in Venezuela threatens to squeeze supply and pushed oil prices up on Tuesday.

In currency markets, the pound was flat at $1.3127, having recovered its footing after British Prime Minister Theresa May said she would seek another delay to Brexit to work out an EU divorce deal with opposition Labour leader Jeremy Corbyn. The dollar was down a hair against the yen to 111.27 and the euro was unchanged at $1.1202.

The dollar index, which tracks the greenback against a basket of six major rivals, was down less than 0.1 per cent at 97.289. Gold was slightly lower, with spot gold trading at $1,291.31 per ounce.

(With inputs from agencies.)

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