Asian futures rise as dollar extends gains; silver pares advance

Traders work on the floor at the New York Stock Exchange on June 17, 2013. — Reuters pic
Traders work on the floor at the New York Stock Exchange on June 17, 2013. — Reuters pic

SINGAPORE, Aug 13 — Asian stock-index futures rose and the dollar extended gains versus major peers amid prospects US and European data this week will bolster the outlook for the global economy. Silver retreated from a two-month high.

The greenback climbed at least 0.3 per cent versus the currencies of Japan, Australia and New Zealand by 8:22 a.m. in Tokyo. Futures on Japan’s Nikkei 225 Stock Average were bid at 13,640 in the Osaka pre-market, after closing at 13,615 in Chicago and 13,510 in Japan yesterday. Contracts on Australia’s S&P/ASX 200 Index gained 0.2 per cent. Standard & Poor’s 500 Index futures were little changed after the gauge dropped a second day in New York. Silver lost 0.2 per cent after surging the past four days, while copper futures rose.

US retail sales climbed a fourth month in July, while industrial output in the euro region rose the most in June since 2011, according to surveys of economists by Bloomberg before data due today. A report tomorrow will probably show the euro zone economy grew for the first time in seven quarters in the three months to June 30, a separate poll showed. The Bank of Japan releases minutes of its July meeting today, and Li & Fung Ltd. to Tata Steel Ltd. and Ayala Corp. report earnings.

“Market participants are hyper-sensitive to data right now,” Ravi Bharadwaj, a senior market analyst in Washington at Western Union Business Solutions, a unit of Western Union Co., said by phone. “Forward expectations are certainly helping the dollar to push sharp gains.”

Japan, home of 2013’s best performing major developed market, also reports machinery order data for June today, with economists tipping a 2.6 per cent annualized increase for the month, down from 16.5 per cent in May. The Topix Index slid 0.6 per cent yesterday in Tokyo, closing at the lowest level this month.

Sina Earnings

Futures on the Hang Seng gained 0.3 per cent in their most recent trading session, while futures on the Hang Seng China Enterprises Index of Chinese stocks traded in Hong Kong climbed 0.4 per cent. The S&P 500 fell 0.1 per cent yesterday.

The Bloomberg China-US Equity Index of the most-traded Chinese equities in New York increased 1.8 per cent in a third day of gains, led by Sina Corp. The Shanghai-based owner of China’s largest Twitter-like service reported better-than- estimated second-quarter revenue and earnings-per-share after US markets closed. Its shares rallied more than 5 per cent in after-hours trading.

The MSCI Asia Pacific Index of regional equities rose 0.1 per cent yesterday in a third day of gains, led by energy and raw materials producers. The measure is up 3.7 per cent this year, compared with an 11 per cent rally in MSCI’s All-Country World Index, data compiled by Bloomberg show. Asia-Pacific stocks trade at 12.3 times estimated earnings, versus a valuation of 13.3 times for global equities.

European Data

Retail sales in the US probably climbed 0.3 per cent in July after a 0.4 per cent advance in June, according to the median of 66 estimates compiled by Bloomberg. Other data this week may show gains in manufacturing, residential construction and consumer prices last month.

Industrial production in the euro region rose 1 per cent in June, after contracting 0.3 per cent in May, the median of 37 estimates shows, while gross domestic product is predicted to have grown 0.2 per cent in the second quarter, after falling 0.2 per cent in the first three months of 2013, according to the median of 41 estimates.

Factory output in India fell an annualized 2.2 per cent in June, government data yesterday showed, more than the 1.1 per cent drop estimated by economists. The consumer price index rose a less-than-estimated 9.64 per cent in July. The Asian nation plans to introduce curbs on imports of products including gold and silver to stem the rupee’s depreciation and pare the record current-account deficit, Finance Minister Palaniappan Chidambaram said yesterday.

Yen, Kiwi

The Bloomberg Dollar Index, which tracks the greenback against 10 major peers including the yen, rose 0.1 per cent today after gaining 0.4 per cent yesterday to snap a six-day slump.

The yen lost 0.3 per cent to 97.2 per dollar today, and slipped 0.3 per cent to 129.22 per euro, weakening a second day against both currencies. The yen depreciated after a government report yesterday showed the nation’s economy expanded less than economists forecast in the second quarter.

Australia’s currency weakened a second day, declining 0.3 per cent to 91.25 US cents before National Australia Bank Ltd.’s business confidence survey and the Treasury’s pre- election economic and fiscal outlook report. The nation votes Sept. 7. New Zealand’s dollar also dropped, depreciating 0.4 per cent to 79.83 cents.

US Movers

The S&P 500 posted its biggest weekly decline since June last week, dropping 1.1 per cent amid concern the Federal Reserve will reduce the pace of its its US$85 billion (RM276 billion) in monthly bond purchases as the economy improves.

Tesla Motors Inc. fell 3.7 per cent in New York after Lazard downgraded the carmaker’s shares. Hecla Mining Co. gained 5.8 per cent, helping lead precious-metal producers higher as gold and silver rallied. BlackBerry Ltd. jumped 11 per cent in Toronto after the smartphone maker’s board said it is exploring alternatives, including a possible sale.

Last week’s retreat in US stocks came after the S&P 500’s valuation jumped to the highest level in more than three years. The benchmark index has rallied 18 per cent this year and trades at 15.3 projected earnings, up from a multiple of 13.1 at the beginning of this year, data compiled by Bloomberg show.

Treasuries Fall

Earnings grew 3.6 per cent for the 450 companies in the S&P 500 that posted results so far in the reporting season, according to data compiled by Bloomberg.

Speculation that the Fed will taper bond purchases designed to support the economy in September has stoked fluctuations in the market. The S&P 500 sank as much as 5.8 per cent over the five weeks ended June 24, before recovering all those losses to reach an all-time high Aug. 2.

Ten-year Treasury yields rose four basis points, or 0.04 per centage point, to 2.62 per cent in US trading. US 30-year bond yields gained five basis points to 3.68 per cent and two- year note rates were little changed at 0.30 per cent. The Fed is scheduled to buy as much as US$20.5 billion of Treasuries through Aug. 23, while the US won’t sell any notes until the auction of five-year Treasury Inflation Protected Securities on Aug. 22.

Indirect investors, which include foreign central banks, won a larger-than-average amount of US bonds at three auctions last week totaling US$72 billion. Ten-year notes traded in a range of about nine basis points last week, the narrowest since the five days ended April 26.

Gold Trading

The MSCI Emerging Markets Index rose a third day yesterday, adding 0.7 per cent.

Gold retreated 0.2 per cent to US$1,335.74 an ounce in early trading, after rallying 1.8 per cent yesterday in a fourth day of gains. Silver dropped to US$21.36, after rallying almost 10 per cent over the past four days. Platinum and palladium were little changed.

Copper futures climbed 0.4 per cent, rising for the third time in four days.

West Texas Intermediate crude increased a third day, adding 0.2 per cent to US$106.29 a barrel. Libya shut its biggest oil export terminal and a compressor breakdown at BP Plc.’s Ula platform in the North Sea cut production of Ekofisk crude, stoking gains in Brent, which jumped 0.7 per cent yesterday. – Bloomberg

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