Asia Stocks to Gain on Earnings, Trade Optimism

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(July 24): Asian shares looked set for gains after signs of progress in U.S.-China trade talks though technology stocks will be in focus after U.S. antitrust moves in the sector. Treasuries fell and the dollar climbed.

Futures pointed higher in Japan, Australia and Hong Kong as the S&P 500 Index finished back above the 3,000 level. After the market closed, shares of Amazon, Alphabet and Facebook declined more than 1% after the Justice Department said it is opening a broad antitrust review into whether dominant technology firms are unlawfully stifling competition.

Investors closely monitoring the U.S. earnings season for any signs the trade war is impacting profitability were buoyed by encouraging reports from Coca-Cola, United Technologies and Texas Instruments. Meanwhile, Bloomberg reported that U.S. Trade Representative Robert Lighthizer is set to travel to China next Monday for the first high-level, face-to-face trade negotiations between the world’s two-biggest economies since talks broke down in May.

On the flip side, the International Monetary Fund again trimmed its global growth outlook amid concerns that trade and Brexit could derail a projected rebound.

Elsewhere, the British pound stayed lower after Boris Johnson was officially named by the Conservative Party as Prime Minister Theresa May’s replacement. Oil rose on trade optimism.

Here are some key events coming up:

    Earnings season rolls on with companies including Amazon.com, Alphabet, Unilever, Caterpillar, McDonald’s and Boeing still to report this week.
    Thursday brings the European Central Bank policy decision. Economists widely expect officials to signal their readiness to cut interest rates and potentially broaden stimulus. Some see the chance of an immediate rate cut. ECB President Mario Draghi holds a briefing afterward.

These are the main moves in markets:
Stocks

    Futures on the Nikkei 225 rose 0.3% in Singapore.
    Australia’s S&P/ASX 200 Index futures gained 0.5%.
    Hong Kong’s Hang Seng Index contracts added 0.3%.
    The S&P 500 Index rose 0.7%.

Currencies

    The yen was steady at 108.20 per dollar after weakening 0.4%.
    The offshore yuan was at 6.8853 per dollar.
    The Bloomberg Dollar Spot Index rose 0.4%, the third consecutive gain.
    The euro declined 0.5% to $1.1148.
    The British pound fell 0.3% to $1.2435, the third straight decline.

Bonds

    The yield on 10-year Treasuries rose 3 basis points to 2.08%.

Commodities

    West Texas Intermediate rose 1.7% to $57.17 a barrel.
    Gold was little changed at $1,419.33 an ounce after falling 0.5%. - Bloomberg