Asian shares extend a global rally as dollar languishes

Hong Kong, Jul 20 (BNA): Asian stocks extended their global rally as strong US corporate earnings and the expected resumption of Russian gas supplies to Europe helped lift sentiment and ease fears of a recession, while the dollar sank near two-week lows. .

MSCI’s broadest index of Asia Pacific shares outside Japan (.MIAPJ0000PUS) rose 1.1% in early Asian trade, led by a 1.5% jump in resource-heavy Australia, 1.1% gains in South Korean shares, and a 1.5% jump in Hong Kong stores.

The S&P 500 rose 2.8% while the heavy Nasdaq Composite added 3.1% on Tuesday, Reuters reported.

“In addition to the tech-driven rally in equities, the headline news flow was mostly around Europe that lifted the euro back above 1.02 with core European yields also rising broadly,” said NAB chief strategist Rodrigo Cattrell.

The European Central Bank was weighing a 50 basis point rate hike, twice the rally many market participants were priced in, helping the euro to post its biggest one-day percentage gain in one month.

The single currency gained 0.1% to $1,0231 in early Asian trading on Wednesday.

The dollar is little changed against its major peers, holding near two-week lows amid waning expectations that the Federal Reserve may resort to a 100 basis point hike at its meeting next week.

Markets are still anticipating a massive 75bp rate hike from the Federal Reserve to rein in severe inflation.

The monitored portion of the US yield curve remained inverted with the two-year yield at 3.2353%, not much changed from the previous close of 3.2310%.

The yield on the standard 10-year Treasury bond was 3.0265% compared to its close at 3.019%.

Oil prices have come under pressure from the World Central Bank’s efforts to tame inflation and ahead of the expected increase in US crude inventories with weak demand for products.

US crude fell 0.59 percent to $103.6 a barrel, while Brent crude fell 0.36 percent to $106.95 a barrel.

Spot gold remained weak at $1,711 an ounce.

ZHB