(Bloomberg) — Asian stocks were steady Wednesday as traders evaluated the biggest jump in the Nasdaq 100 since November and whether a rout in China will stabilize. The dollar pared some of its overnight losses and Treasury yields held declines.
The Nasdaq 100 advanced 4% on a revival of higher-valuation stocks such as Tesla Inc., which jumped 20%. The move snapped a rotation into value shares based on optimism about an economic reopening aided by fresh stimulus and vaccines. S&P 500 contracts and futures on the tech-heavy gauge dipped.
In Asia, Chinese shares rallied from a slump on Tuesday that evaded state efforts to slow the pace of losses. Hong Kong’s benchmark rose and Japan fluctuated. Treasury yields steadied below their recent peaks as the first in a string of U.S. auctions went off without disrupting markets. Bitcoin dipped below $54,000 after reaching a two-week high.
The pullback in Treasury yields encouraged investors to wade back into growth stocks, which suffered recently amid concerns about valuations. The prospect of faster inflation as economies recover from the pandemic has pushed up longer-term borrowing costs this year. In China, a report showing surging producer prices highlighted the risk of the nation exporting inflation as factories charge more for goods sold abroad, and upcoming consumer prices data in the U.S. are expected to show a slightly faster annual increase.
The recent rising trend in bond yields is consistent with economic growth expectations, said Lauren Goodwin, portfolio strategist at New York Life Investments. That backdrop still favors cyclicals over defensive assets and “supports equities over bonds, and a weaker U.S. dollar,” she said.
The upcoming sales of U.S. 10- and 30-year government bonds will test appetite for the safest debt after last month’s poorly bid seven-year auction helped drive yields higher, sending tremors across risk assets globally.
The Australian dollar declined after the central bank governor suggested markets may be getting ahead of themselves by pricing in an interest-rate increase within the next couple of years.
Here are some key events to watch:
EIA crude oil inventory report is due WednesdayThe U.S. February consumer price index will offer the latest look at price pressures Wednesday.The U.S. government auctions 3-, 10- and 30-year Treasuries this week.The European Central Bank holds its monetary policy meeting and President Christine Lagarde is set to do a briefing Thursday.
Stocks
S&P 500 futures were down 0.2% as of 6 a.m. in Tokyo. The S&P 500 index advanced 1.4%. Nasdaq 100 futures fell 0.4%.Japan’s Topix index was little changed.Australia’s S&P/ASX 200 index was 0.8% lower.South Korea’s Kospi index fell 0.5%.Hong Kong’s Hang Seng index rose 0.1%.China’s CSI 300 index climbed 1.2%.Euro Stoxx 50 futures slid 0.3%.
Currencies
The yen was at 108.91 per dollar, up 0.4%.The offshore yuan traded at 6.5230 per dollar.The Bloomberg Dollar Spot Index added 0.3%.The euro decreased 0.2% to $1.1874.
Bonds
The yield on 10-year Treasuries rose one basis point to 1.54%.Australia’s 10-year bond yield fell seven basis points to 1.71%.
Commodities
West Texas Intermediate crude fell 0.8% to $63.49 a barrel.Gold shed 0.3% to $1,711.07 an ounce.
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