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GLOBAL MARKETS-Asian stocks set for gains as bond yields dip

Published 12/03/2021, 09:58 am
Updated 12/03/2021, 10:00 am
© Reuters.
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* Nikkei/Hang Seng futures up 0.6%

* E-mini futures for S&P 500 up 1%

* ECB says it will speed up bond purchases

* U.S. initial jobless claims less than expected

* Tech shares lead Wall Street higher

By Matt Scuffham

NEW YORK, March 11 (Reuters) - Asian stocks were set for a strong start on Friday, following firm overnight leads from Wall Street and Europe as a further retreat in bond yields eased concerns about rampant inflation, restoring appetite for battered tech stocks.

Euro zone bond yields fell after the European Central Bank said it was ready to accelerate money-printing to keep a lid on borrowing costs, using its 1.85 trillion euro Pandemic Emergency Purchase Program (PEPP) more generously over the coming months to stop any unwarranted rise in debt financing costs. Nikkei 225 futures NKc1 added 0.62% and Hong Kong's Hang Seng index futures .HSI HSIc1 rose 0.55%.

E-mini futures for the S&P 500 EScv1 rose 0.99%.

Australian S&P/ASX 200 futures YAPcm1 rose 0.55% in early trading.

"It's looking like we'll see a positive open across Asia-Pacific markets," said Michael McCarthy, chief markets strategist at CMC Markets. "The big news overnight was the decision from the ECB. There might be some disappointment they didn't expand their bond purchase program but that's largely offset by undertakings to accelerate the purchases."

The German 10-year yield was last at -0.332 after falling as far as -0.367%, the lowest level since Feb. 18 and further away from the near one-year high of -0.203% in late February.

The yield on the benchmark 10-year Treasury note US10YT=RR fell as low as 1.475%, the first time it had dipped below 1.5% in a week. It last yielded 1.5352%, from 1.52% late on Thursday.

On Wall Street, the easing inflation worry helped support equities, with the highly valued technology sector .SPLRCT leading the way higher, up 2.12%. Expensive stocks, many of which are in the tech sector, have been highly sensitive to the recent rise in yields.

In contrast, shares of bank stocks .SPXBK lost 0.47%. Still, while the Dow and S&P 500 closed at record highs, the tech-heavy Nasdaq paced the gains, rising more than 2% on the day.

The Dow Jones Industrial Average .DJI rose 0.58%, the S&P 500 .SPX gained 1.04% and the Nasdaq Composite .IXIC added 2.52%.

Sentiment was also boosted by weekly jobless claims data, which pointed to a recovering U.S. labor market as vaccine rollouts helped lead to economic reopenings. stocks climbed, with the pan-European STOXX 600 higher for a fourth straight day, its longest winning streak in five weeks, with the index closing at its highest level since Feb. 21, 2020. The STOXX 600 index .STOXX rose 0.49% and MSCI's gauge of stocks across the globe .MIWD00000PUS gained 1.37%.

An auction of 30-year U.S. debt on Thursday was viewed as slightly weak, but nowhere near the disappointing seven-year auction in late February that helped fuel inflation concerns and sent yields higher. largely expect inflation to pick up as vaccine rollouts lead to a reopening of the economy, but worries persist that additional stimulus in the form of a $1.9 trillion coronavirus relief package set to be signed by U.S. President Joe Biden could overheat the economy. dollar was weaker for a third straight day coming off a 3-1/2-month high of 92.506 on Tuesday.

The dollar index =USD fell 0.43%, with the euro EUR= down 0.01% to $1.1983.

Oil prices resumed their climb following two days of declines, buoyed by the brightening economic outlook and a decline in the dollar. crude CLc1 settled up 2.5% at $66.02 per barrel and Brent LCOc1 was at $69.63, up 2.6% on the day.

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