Asian Stock Markets Rose Following a Wall Street Rally

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A positive shift in market sentiment bolstered Asian stock markets as data showed inflation slowing globally. The US stock market closed at its highest level, reflecting investor confidence that the recent global share rally will continue. 

Australia, South Korea, Hong Kong, and mainland China all saw gains in their stock markets. As the yen’s recovery continued to hurt exporters, Japan’s markets opened lower, painting a contrasting picture.

Additionally, investors are on high alert for another surprise when the Bank of Japan announces its policy on January 13: “Japan’s benchmark 10-year bond yield increased marginally, and it rose above the BOJ’s upper limit for the second day in a row.”

The desire for riskier assets was reflected by the dollar’s decline versus all of its G-10 currency rivals. Following a weekend rally during which it soared, hoping it may have reached a bottom, Bitcoin traded above US$21,000 on January 9.

Australia and New Zealand saw an increase in bond yields. The US 10-year yield increased to 3.50 per cent on January 13. Due to the US financial markets being closed for a holiday, there will be no Treasury trading.

As they balance this with the reopening of the economy, traders are also considering the impact of the rising Covid infections. 

In the weeks leading up to the Lunar New Year holidays, the People’s Bank of China pumped less money than anticipated into the banking sector while maintaining the rate of its one-year medium-term loan facility steady. 

“US short-term inflation views dropped to their lowest level in nearly two years in early January,” according to the most recent sample released last week, giving consumer confidence a more considerable boost than anticipated.

Data released this week increased hope that the Federal Reserve could halt the pace of interest rate growth. 

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