(Bloomberg) — Equities in Japan and Australia rose in thin trading with most Asian markets closed while US stock futures were flat as investors awaited news of a bid for First Republic Bank.
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Stocks in Japan and Australia edged higher while futures contracts for the Hang Seng Index also advanced, although Hong Kong will be closed for trading, alongside China, Singapore and many countries in Europe to observe May 1 holidays.
The muted moves in US futures followed a 0.8% jump for the S&P 500 Friday to cap two consecutive weekly gains for the first time in a month. The benchmark also posted back-to-back monthly gains for the first time in five months. The CBOE Volatility Index fell below 16 points for the first time since November 2021 as solid corporate earnings boosted sentiment.
The future of First Republic Bank weighed on markets, however. Regulators worked into the evening on Sunday in Washington after requesting a group of banks including JPMorgan Chase & Co. and PNC Financial Services Group Inc. submit bids for the embattled lender.
Treasuries fell slightly after a Friday rally. Australian 10-year notes were flat and those for New Zealand rose. The yen weakened while the greenback and the Australian dollar strengthened. A sudden drop for Bitcoin dragged the cryptocurrency further below $30,000 after a stellar run this year.
Interest rate decisions will be in focus this week. The Federal Reserve is expected to increase borrowing costs 25 basis points to a range of 5% to 5.25%, a level not seen since 2007. The European Central Bank is also expected to raise its key lending rates by 25 basis points. The Reserve Bank of Australia is forecast to keep interest rates on hold when it meets Tuesday.
“Earnings season is showing the demand in the market, which is a key engine of inflation, is still quite robust,” Hebe Chen, an analyst with IG Markets, said in an interview on Bloomberg Television. The Fed must also play down the chances for rates to fall later this year, “potentially putting a cap on the unrealistic expectations for a rate cut,” she said.
Apple Inc. headlines another busy week of earnings that includes Advanced Micro Devices Inc. and Ford Motor Co. In Asia, banks including HSBC Holdings Plc and Macquarie Group Ltd. will deliver their profit reports. In Europe, Volkswagen AG and energy giants BP Plc and Shell Plc are on the docket.
Elsewhere, oil prices declined and gold fell.
Here are some of the main moves in markets:
Stocks
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S&P 500 futures were little changed as of 11:37 a.m. Tokyo time. The S&P 500 rose 0.8% Friday
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Nasdaq 100 futures were little changed. The Nasdaq 100 rose 0.7% Friday
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Hang Seng futures rose 1%
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Japan’s Topix rose 0.6%
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Australia’s S&P/ASX 200 rose 0.5%
Currencies
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The Bloomberg Dollar Spot Index rose 0.1%
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The euro fell 0.1% to $1.1006
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The Japanese yen fell 0.4% to 136.78 per dollar
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The offshore yuan fell 0.3% to 6.9472 per dollar
Cryptocurrencies
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Bitcoin fell 2.4% to $28,637.34
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Ether fell 2.5% to $1,846.41
Bonds
Commodities
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West Texas Intermediate crude fell 0.8% to $76.17 a barrel
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Spot gold fell 0.3% to $1,983.44 an ounce
This story was produced with the assistance of Bloomberg Automation.
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