SYDNEY (March 3): Asian stocks climbed Tuesday after the biggest advance in U.S. shares since their December 2018 rebound from a brush with a bear market.
Central bankers from the U.S., Japan and Europe spurred the rebound by pledging to act as appropriate to address mounting risks from the coronavirus. Group of Seven finance chiefs and central-bank governors confer by telephone later Tuesday.
Futures on the S&P 500 rose in Asia after the benchmark gauge rallied 4.6% and stocks in Japan and Australia pushed higher.
Crude oil added to a jump of more than 4%. Treasury yields were steady, while the dollar ticked lower.
“There is this sense that central bank liquidity will be coming to an equity market near you,” said Ray Attrill, head of foreign-exchange strategy at National Australia Bank in Sydney.
The Bank of Japan “got the ball rolling” Monday with a bond-repurchase operation and record ETF purchase and the Reserve Bank of Australia “is the next cab off the rank,” he said.
The RBA is expected by investors and a rising number of economists to cut its benchmark by a quarter point to a record-low 0.5% Tuesday.
The central banks’ turn follows signs of mounting damage to the global economy. The OECD is warning that growth will sink to levels not seen in more than a decade. Global manufacturing contracted in February by the most since 2009 as the outbreak severely disrupted demand, trade and supply chains.
The global death toll from the virus has now surpassed 3,000. U.S. cases climbed, with four patients dying in Washington State and the first infections appearing in New York City, Brussels and Berlin, while cases jumped in hot spots of Italy, Iran and South Korea.
Here are some key events coming up:
* The Reserve Bank of Australia sets policy on Tuesday.
* U.S. citizens in states including California and Texas will vote on “Super Tuesday” for a Democratic candidate to run against President Donald Trump in November’s election.
* The Bank of Canada has a rate decision on Wednesday.
* OPEC ministers gather in Vienna on March 5-6.
These are the main moves in markets:
* S&P 500 futures rose 0.8% as of 9 a.m. in Tokyo. The S&P 500 Index rose 4.6%.
* Topix index climbed 1.3%.
* Australia’s S&P/ASX 200 Index climbed 1.9%.
* Hong Kong’s Hang Seng Index futures fell 0.3% earlier.
* The Japanese yen traded 0.2% lower at 108.50 per dollar.
* The offshore yuan was little changed at 6.9565 per dollar.
* The euro traded at $1.1144, up 0.1%.
* The yield on 10-year Treasuries rose more than one basis point to 1.16%.
* Australia’s 10-year bond yield rose one basis point to 0.81%.
* West Texas Intermediate crude climbed 2.6% to $47.93 a barrel.
* Gold was little changed at $1,592.22 an ounce.