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Sunday, September 27th, 2020

Asian stocks climb, euro surrenders gains as French election jitters return

by April 21, 2017 General

A man looks at an electronic board outside a brokerage in Tokyo July 6, 2016. — Reuters pic A man looks at an electronic board outside a brokerage in Tokyo July 6, 2016. — Reuters pic SINGAPORE, April 21 — Asian stocks rose, lifted by bets on strong US earnings and US tax reform, while the euro retreated from a three-week high as jitters returned over the first round of French presidential elections on Sunday after a shooting in Paris.

MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.25 per cent. It is set to end the week 0.6 per cent lower.

Japan’s Nikkei advanced 0.8 per cent, on track for a weekly gain of 1.3 per cent.

The euro was marginally higher at US$1.07185 early today. Yesterday, it jumped to 1.0778, its highest level since March 29, and French stocks jumped by 1.5 per cent after polls showed French centrist Emmanuel Macron easily beating far-right, anti-European Union candidate Marine Le Pen in the second round on May 7.

But the euro fell back to close only slightly higher after a shooting on the Champs-Elysees shopping boulevard, in which one policeman was killed and two others were wounded. Islamic State claimed responsibility for the attack, according to the group’s Amaq news agency.

“Euro bulls will definitely respond to positive news around Macron, but that dissipates as the reality of low turnouts sets in,” said Alfonso Esparza, senior currency analyst at OANDA in Toronto.

“Everybody remembers the Brexit polls and even the US election polls. After those misses it is going to take a lot to make the markets trust them again.”

French 10-year Treasury yields slumped to a three-month low of 0.856 per cent yesterday, while safe-haven German bund yields jumped to 0.244 per cent, their highest close in two weeks.

Markets are awaiting several economic indicators from Europe later in the session, including Eurozone manufacturing and services figures for April and British retail sales for March, to be followed by US manufacturing and services data for April and existing home sales for March.

Wall Street indexes closed between 0.75 per cent and 0.9 per cent higher on rising expectations for first-quarter corporate profits. S&P 500 stock index company earnings now are expected to have gained 11.1 per cent in the first quarter.

The US dollar retained yesterday’s 0.4 per cent gain, trading flat at 109.34 yen. It is up 0.7 per cent for the week.

The US dollar index, which tracks the greenback against a basket of trade-weighted peers, was also steady at 99.816, on track to lose 0.7 per cent this week.

In commodities, oil was stronger today following yesterday’s choppy session as a tussle continued between worries over rising US production and optimism over comments from leading Gulf oil producers that an extension to Opec-led supply cuts was likely.

US oil jumped 1.1 per cent to US$50.83 (RM223.68) a barrel early today, its biggest one-day gain in almost two weeks, shrinking losses for the week to 4.4 per cent.

Gold was also little changed today at US$1,280.61 an ounce, holding on to most of yestersday’s 0.2 per cent gain as investors remained hesitant ahead of the French election. It is poised for a weekly loss of 0.35 per cent. — Reuters