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Investing.com – Asia Pacific stocks were up on Friday morning as investors evaluated the economic outlook and interest rates hike expectations.
Japan’s Nikkei 225 gained 0.83% by 10:42 PM ET (2:42 AM GMT).
South Korea’s KOSPI jumped 2.20%
In Australia, the ASX 200 rose 0.44%
Hong Kong’s Hang Seng climbed 1.33%
China’s Shanghai Composite was up 0.69% while the Shenzhen Component was up 0.97%
S&P 500 and Nasdaq 100 rose above 1%.
The policy-sensitive US two-year yield is on course for one of its biggest weekly drops since March 2020. The yield on 10-year Treasuries rose one basis point to 3.10%. Oil rebounded to about $104 a barrel.
Unclear monetary policies are still on investors’ radars. U.S. Federal Reserve Chair Jerome Powell reiterated that Fed’s inflation fight is “unconditional”, while Fed Governor Michelle Bowman said she supports another 75-basis points interest rate hike in July, followed by a few more half-point hikes.
Investors are negotiating “a fraught transition from ‘front-loaded’ synchronized tightening towards demand destruction and peak ‘price-pressure’,” Citigroup Inc. strategists William O’Donnell and Edward Acton said in a note.
Geopolitical and supply chain disruptions are adding the “price-pressure” and energy could return to an “upward trend for at least a couple of months,” Defiance ETFs LLC chief investment officer Sylvia Jablonski told Bloomberg.
Adding to concerns of slowing economic growth, U.S. initial jobless claims reached 229,000 last week, hovering near a five-week high. U.S. University of Michigan consumer sentiment is due later in the day.
