Asian stocks track Wall Street’s rally, led by Nvidia

HONG KONG (Reuters) – Asian stocks rose on Thursday after strong earnings from technology company Nvidia (NVDA.O) boosted Wall Street and falling US bond yields eased pressure on borrowing costs globally.

A round of weak manufacturing surveys also revived hopes that central banks have tightened monetary policy, although that may change depending on clues about interest rates that Federal Reserve Chairman Jerome Powell presents at the annual central bank summit in Jackson Hole, Wyoming, on Monday. Friday.

“Stocks rallied and bond yields fell as preliminary August PMI data pointed to weaker economic activity in the US, eurozone and UK, fueling market expectations that central banks may not have to raise interest rates again,” ANZ analysts said in a note. “.

“This week’s Jackson Hole seminar continues to be very closely watched by the markets…we expect (Powell) to err on the side of caution on inflation, indicating some signs of improvement but still a long way to go.”

European markets were poised for a higher open, with Euro Stoxx 50 futures up 1.7%, German DAX futures up 0.6%, and FTSE futures up 0.5%.

MSCI’s broadest index of Asia-Pacific stocks outside Japan (.MIAPJ0000PUS) rose 1.7%, also supported by Nvidia’s bullish outlook.

However, the index is down 8.1% so far this month due to a weaker Chinese economy and Yuan, as well as some dismal factory readings from Japan, which also left sentiment fragile.

US stock futures, S&P 500 e-minis, rose 0.77%.

Australian shares (.AXJO) rose 0.63%, while the Japanese stock index (.N225) rose 0.81%, marking the fourth straight session of gains on Thursday, the longest streak since mid-June.

Chinese stocks also rebounded on Thursday, with the CSI300 Blue-chip Index (.CSI300) up 1.28% and Hong Kong’s Hang Seng Index (.HIS) up 2.1% in afternoon trade as some investors bought the dip after recent declines.

The yuan rose against the dollar, as the central bank continued to hold its daily midpoint at stronger-than-expected levels.

“With the Chinese currency appreciating today, foreign capital has again flowed in and helped stabilize Chinese stock markets,” said Zhang Zihua, chief investment officer at Beijing Uniyi Asset Management. “The rally in the broader Asian markets after Nvidia’s forecast also lifted sentiment.”

Foreign investors bought 2.9 billion yuan ($398.78 million) worth of Chinese stocks so far during the day, snapping a 13-day selling streak.

US stocks ended Wednesday sharply higher across the board as Nvidia shares jumped nearly 10% in post-bell trading, hitting an all-time high after it forecast third-quarter revenue well above Wall Street targets.

On Wall Street, the Dow Jones Industrial Average (.DJI) rose 0.54%, the S&P 500 Index (.SPX) rose 1.10%, and the Nasdaq Composite Index (.IXIC) added 1.59%.

In US Treasuries, the yield on the benchmark 10-year Treasury came in at 4.2076% compared to the US closing at 4.198% on Wednesday when it fell from its highest level in nearly 16 years after weak business activity data from the US and the Eurozone.

The 2-year yield, which rises as traders expect higher rates on the Fed Funds, came in at 4.9885% compared to the US close of 4.952%.

In currency markets, the dollar index remained stable at 103.35 in afternoon trading in Asia, after hitting a two-month high of 103.4 against a basket of major currencies.

The yen rebounded to 145.165 after hitting a nine-month low of 145.34 amid talk from a former Bank of Japan official that Japan will only intervene in the market if the currency falls above 150 against the dollar.

US crude fell 0.06% to $78.84 a barrel. Brent crude fell to $83.2 a barrel.

Gold was a little higher. Spot gold traded at $1,919.5 an ounce.

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