Stocks, Futures Push Higher After Two-Week Slide: Markets Wrap

(Bloomberg) — Asian stocks started the week with gains and U.S. futures pointed higher as investors looked ahead to a Federal Reserve meeting that could provide clues on the policy outlook. The dollar and Treasuries were little changed.

Shares saw modest gains in Japan, Australia and South Korea. S&P 500 futures climbed about 0.8%. Helping to buoy sentiment were comments from the Pfizer Inc. CEO about the likely deployment of a vaccine to Americans by year-end and reports that the sale of TikTok in the U.S. was nearing a conclusion. Gold was steady and crude oil ticked higher.

Global stocks are coming off the back of the first consecutive weeks of declines since March and traders remain on edge given the recent reassessment of valuations and volatility in options markets. With the Fed expected this week to maintain its dovish stance on policy, investors will continue to look out for signs the global economy is recovering from the pandemic.

“With no clear assured path to economic recovery and release from the grips of coronavirus and with the added geopolitical risks of the fast-approaching U.S. presidential election and then the Brexit deadline at year-end, we expect broad market sentiment to remain fragile for the foreseeable future,” said Simon Ballard, chief economist at First Abu Dhabi Bank.

On the virus front, the Pfizer comments suggested a shorter time frame for a vaccine than most public health officials have suggested. Earlier, AstraZeneca Plc and the University of Oxford restarted a U.K. trial of their vaccine after the study was halted over concerns about a participant who fell ill.

Meantime, Japan’s ruling party chooses its new leader Monday. Yoshihide Suga is the favorite to replace Prime Minister Shinzo Abe.

Here are some key events coming up:

China industrial production and retail sales data is due on Tuesday.Wednesday sees the FOMC policy decision and news conference from Chair Jerome Powell.Bank of Japan, Bank Indonesia and Bank of England policy decisions come Thursday.Friday sees quadruple witching for U.S. markets when the quarterly expiration of futures and options on indexes and stocks happens on the same day.

These are the main moves in markets:

Stocks

S&P 500 futures rose 0.8% as of 9:05 a.m. in Tokyo. The index ended Friday little changed.Japan’s Topix index gained 0.4%.South Korea’s Kospi index added 0.9%.Australia’s S&P/ASX 200 Index rose 0.2%.

Currencies

The yen was steady at 106.12 per dollar.The offshore yuan was at 6.8323 per dollar.The euro bought $1.1841, little changed.

Bonds

The yield on 10-year Treasuries remained at 0.67%.Australia’s 10-year yield fell three basis points to 0.88%.

Commodities

West Texas Intermediate crude rose 0.4% to $37.49 a barrel.Gold was at $1,942.80 an ounce, up 0.1%.

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