Stocks fell and the dollar rose on Friday, beginning the second half of the year much as the first one had ende.
S&P 500 futures fell 1%. MSCI’s index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 1%, with the heaviest fall in Taiwan where the growth-sensitive benchmark index (.TWII) slid 3% to its lowest since late 2020.
Japan’s Nikkei (.N225) fell 2%. The Australian and New Zealand dollars each fell 1% to two-year lows. U.S. Treasuries rose, driving benchmark 10-year yields to one-month lows.
It has been hints of peaking inflation and signs of weak growth that have started steadying bond markets.
The two-year yield is down almost 14 basis points this week to 2.904%. The 10-year yield is down about 15 bps on the week to 2.9667%.
CHINA BRIGHT
The dollar had its best quarter since 2016 for the three months to the end of June as U.S. yields rose. Economic uncertainty has kept it supported even as yields have retreated. The kiwi slid 1% to %0.6178.
The yen rose about 0.5% to 135.08 per dollar and a little further to 141.31 per euro .
A string of surveys on Friday showed China emerging as an outlier. Factory activity bounced solidly in June against slowdowns in Japan and South Korea and contraction in Taiwan.
Markets are also bouncing and though the Shanghai Composite (.SSEC) and blue-chip CSI300 (.CSI300) edged about 0.3% lower on Friday, they are each set to log five straight weeks of gains.
Hong Kong’s markets were closed for a holiday, and the city was focused on Chinese President Xi Jinping’s visit.
The yuan slipped with the broader market to 6.7136 per dollar. Gold has been weighed by the stronger dollar and U.S. yields and was flirting with $1,800 an ounce.
-Reuters.
