Asian shares rise after Wall St tech gains, dollar extends gains on yen By Reuters

By Stella Qiu

SYDNEY (Reuters) – Asian shares rebounded on Thursday, chasing a technology-led rally on Wall Street, while the dollar held on to gains after U.S. core inflation surprised slightly higher and dashed hopes of a big rate cut to the Federal Reserve next week. .

Investors now await a policy decision from the European Central Bank later in the day, where an interest rate cut is almost a certainty, but the question remains whether it will move again in both October and December.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1 percent. It rose 3%, helped by a weaker yen, which retreated from its 2024 high of 140.71 per dollar.

Earlier in Asian trade, the yen fell further to a low of 142.95 but was last at 142.40 per dollar, perhaps helped a bit by dovish comments from a senior Bank of Japan official who called for interest rates to rise to at least 1%.

EUROSTOXX 50 futures rose 1.2 percent, while they rose 0.9 percent. U.S. stock futures were slightly lower.

Overnight, US data showed the core consumer price index (CPI) rose 0.28% in August, compared with forecasts for a 0.2% increase. It was enough for markets to abandon the chance of a half-point interest rate cut by the Federal Reserve next week, with the probability of such a move at just 15 percent.

“We wanted answers to help settle the debate over the Fed’s 25 basis point rate cut versus 50 basis points on Friday, but now it looks like the market has made up its mind,” said Chris Weston, chief of research at Pepperstone, referring to the August mixed wages report. Friday.

“We are now comfortable proposing a 25 basis point cut for September, but we are also open to the idea that a weak US payrolls report on October 4 would fully open up a 50 basis point cut basis at the FOMC meeting in November”.

Disappointment over core inflation numbers pressured Wall Street, but once again tech stocks came to the rescue, with AI darling Nividia rising 8%, helped by a media report that the US government is considering letting the company exports advanced chips to Saudi Arabia. (.N)

Regional high-tech stock markets followed suit, with Taiwan adding 2.2 percent and South Korea gaining 1.1 percent.

China’s stock markets were lower, while Hong Kong rose 0.4 percent.

In the foreign exchange market, the dollar traded near a four-week high against the euro, which fell to $1.1007, remaining close to Wednesday’s low of $1.1002 – the weakest since Aug. 16. (FRX/)

Short-term US Treasuries sold off overnight. Two-year Treasury yields were flat at 3.3193%, up 4 basis points overnight, while 10-year yields were at 3.3291%.

This allowed the 2-10 year yield curve to flatten slightly and remain barely positive at just 1bp.

Oil rebounded overnight on fears Hurricane Francine could lead to extended U.S. production shutdowns (O/R)

Futures held steady at $70.65 a barrel after gaining 2% overnight. It also found support at $68.69, the lowest level in nearly three years.

Gold traded at $2,513.75 an ounce, just a touch below a record high of $2,531.60.