(Bloomberg) — Asian stocks opened mixed as traders brace for a flood of economic data this week including Chinese activity gauges and the Federal Reserve’s preferred measure of inflation.
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Australian shares rose, with banks and miners contributing the most to the benchmark gauge’s gain. Japan equities advanced, South Korea stocks slipped while equity futures point to a steady open in Hong Kong. Contracts for US shares fell after the S&P 500 rally stalled at the end of last week, weighed by profit taking in megacap tech stocks.
Federal Reserve Bank of New York President John Williams said in an interview published Friday that the economy is headed in the right direction, and it will likely be appropriate to cut rates later this year.
“The week ahead may bring more trouble than calm – as March starts with a world concerned about sticky inflation, doubting the wisdom of waiting central bankers and fearing larger conflicts leading to further global trade disruptions,” Bob Savage, head of markets strategy and insights at BNY Mellon, wrote in a note to clients.
Treasuries steadied in early Asia trading after climbing in the last session, while Australia 10-year yields dropped seven basis points following the gain in US notes at the end of the week. The dollar moved in a tight range against its Group-of-10 peers.
This week, investors will be bracing for the impact from heavy Treasury and corporate issuance and month-end positioning. There’s also a slate of economic data to be scrutinized, including the so-called core personal consumption expenditures price index on Thursday that’s the Federal Reserve’s favored inflation gauge.
Fed speakers are likely to reiterate William’s comments that the central bank doesn’t feel pressure to begin cutting rates anytime soon.
“Recent CPI inflation and employment information have clouded the timing and magnitude of rate cuts in the financial markets,” Stephen Gallagher, chief US economist at Societe Generale SA wrote in a note to clients. “Affirming that rate cuts are likely sustains hopes for cuts in the coming months, albeit not in March.”
Oil held the biggest drop in three weeks after breaching a key moving average, with prices still trapped in a tight trading range.
Elsewhere, Zambia said it reached a deal on debt restructuring with China and India as emerging market investors pile into African debt in a hunt for yield. Meantime, the US and China are discussing new measures to prevent a wave of emerging market defaults, including ways to preemptively extend loan periods before countries miss payments.
Key events this week:
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Japan CPI, Tuesday
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Bank of England Governor Andrew Bailey speaks, Tuesday
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US Conf. Board consumer confidence, durable goods, Tuesday
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Reserve Bank of New Zealand rate decision, Wednesday
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Eurozone economic, consumer confidence, Wednesday
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FTSE 100 index review, Wednesday
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US GDP, Wednesday
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Atlanta Fed President Raphael Bostic, Boston Fed President Susan Collins, New York Fed John Williams speak, Wednesday
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G-20 finance ministers and central bank chiefs meet, Wednesday
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Australia retail sales, Thursday
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France, Germany and Spain CPI, Thursday
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US PCE Deflator, Thursday
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Chicago Fed President Austan Goolsbee, Atlanta Fed President Raphael Bostic, Cleveland Fed President Loretta Mester speak, Thursday
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MSCI index changes, including the removal of 66 Chinese firms from the MSCI China Index, come into effect at the close, Thursday
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China official PMI, Caixin manufacturing PMI, Friday
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Eurozone CPI, Friday
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US ISM Manufacturing, University of Michigan consumer sentiment, Friday
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US House funding bill deadline to avert a government shutdown, Friday
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Atlanta Fed President Raphael Bostic, San Francisco Fed President Mary Daly speak
Some of the main moves in markets:
Stocks
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S&P 500 futures fell 0.1% as of 9:03 a.m. Tokyo time
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Hang Seng futures were little changed
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Japan’s Topix rose 0.5%
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Australia’s S&P/ASX 200 rose 0.3%
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Euro Stoxx 50 futures rose 0.3%
Currencies
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The Bloomberg Dollar Spot Index was little changed
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The euro was little changed at $1.0819
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The Japanese yen was little changed at 150.42 per dollar
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The offshore yuan was little changed at 7.2060 per dollar
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The Australian dollar was little changed at $0.6563
Cryptocurrencies
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Bitcoin fell 0.1% to $51,716.18
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Ether was little changed at $3,108.42
Bonds
Commodities
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West Texas Intermediate crude was little changed
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Spot gold fell 0.1% to $2,033.30 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Matthew Burgess.
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