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Sydney - Asian equities were mixed with technology stocks rising after stellar earnings at Internet giant Tencent. The yen climbed and the dollar extended declines after Federal Reserve meeting minutes reduced the odds of another US interest rate increase this year.
Shares in Japan and Australia finished lower, while they gained in South Korea. European stock-index futures pointed to a weaker start to the trading day. The dollar fell as base-metal prices in Shanghai and London rallied, with zinc touching 10-year highs.
Bond yields tracked a retreat in US yields after the latest Fed minutes showed debate among policy makers about whether higher rates are needed given inflation remains benign. The swaps market sees a reduced chance for a December US interest-rate hike.
The tumult that swept markets in the wake of heightened tensions between the US and North Korea last week has eased, bringing down gauges of equity and bond volatility and repairing most of the damage done to stock markets.
Investors continue to keep an eye on Washington where President Donald Trump disbanded two high-profile business advisory councils following the fallout from his response to the weekend violence in Virginia.
Attention will now turn to the European Central Bank (ECB), which is due to release minutes of its last policy meeting on Thursday, amid signs the euro-area economy gathered pace in the second quarter.
Policy makers have signaled that they are getting closer to phasing out quantitative easing. Meanwhile, Reuters reported that ECB President Mario Draghi won’t deliver a fresh policy message at the Federal Reserve’s annual symposium in Jackson Hole, Wyoming later this month.
In economic news out of Asia, Australian employers added 27 900 jobs in July from June, beating economists’ forecasts of a 20 000 gain. Japan posted a trade surplus for a second consecutive month in July as exports continued to grow, while imports surged again as domestic demand continues to recover.
Earnings at China’s Internet giants will stay in focus. Tencent posted its fastest revenue growth in seven years and record profit that surpassed estimates by 35%, sending its US-traded shares up more than 6%.
READ: Tencent proves why it's the indispensable Asian investment
Alibaba’s up next, set to report first-quarter results before the start of New York equity trading on Thursday.
Here are the main moves in markets:
Stocks
• The MSCI Asia Pacific Index added 0.6% with a subindex of technology stocks up 1.1%.
• Japan’s Topix index and Australia’s S&P/ASX 200 Index each closed 0.1% lower.
• South Korea’s Kospi index climbed 0.6%.
• In Hong Kong, the Hang Seng Index fell 0.3% even as Tencent jumped 2.8%.
• Contracts on the Euro Stoxx 50 fell 0.2% in early European trading.
• Futures on the S&P 500 Index slipped 0.1% as of 7:34 in Tokyo.
• The underlying gauge finished up 0.1%, down from its session high.
• The MSCI All-Country World Index increased 0.3% on Wednesday.
Currencies
• The Bloomberg Dollar Spot Index fell 0.1%, extending the 0.4% slide on Wednesday.
• The yen climbed 0.3% to 109.88 per dollar, extending Wednesday’s 0.4% advance.
• The euro rose 0.1% to $1.1773, adding to a 0.3% gain on Wednesday.
• The Aussie added 0.1% to 79.34 US cents, pulling back from the session’s high after full-time employment dropped in July.
• The currency surged 1.3% after the Fed minutes sent the US dollar lower.
Bonds
• The yield on 10-year Treasuries was at 2.23% after sliding five basis points overnight.
• The 10-year German bund yield fell two basis points to 0.43%.
• Australian government notes with a similar maturity saw yields slip two basis points to 2.64%.
Commodities
• West Texas Intermediate crude added 0.1% to $46.82 a barrel, after falling 1.6% on Wednesday.
• Gold increased 0.3% to $1 287.36 an ounce after rising 0.9% on Wednesday.
• Metals extended a rally spurred by faster global growth and tightening supplies.
• Zinc soared by its daily limit to 25 975 yuan a ton on the Shanghai Futures Exchange, rising 5% to its best mark since October 2007.
• In London, prices advanced as much as 0.8% to $3 145 a ton, a level not seen in almost 10 years.
• Iron ore futures in Singapore were up 5.7%.
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