March 25, 2023


News Headlines: Hindustan Times provides exclusive top stories of the day, today headlines from politics, business, technology, photos, videos, …

Ukraine peace talks, Chinese stimulus, prospects for a US rate hike lift stocks and yields

Ukraine peace talks, Chinese stimulus, prospects for a US rate hike lift stocks and yields
  • S&P futures and MSCI global stocks rose 1.1%
  • Previous MSCI Asia index for Japan rose 4.2%, Hong Kong 9%
  • The 10-year US Treasury yield was 2.204%, the highest since 2019

LONDON (Reuters) – Prospects for Russia-Ukraine peace talks, Chinese stimulus and an impending rise in U.S. interest rates lifted stocks and U.S. Treasury yields on Wednesday.

Russia and Ukraine underlined the new area of ​​compromise on Wednesday as peace talks are set to resume three weeks after a Russian offensive that failed to topple the Ukrainian government by force. Read more

Chinese Vice Premier Liu He said Beijing will take more measures to boost China’s economy, as well as policy steps favorable to capital markets.

Register now to get free unlimited access to

“There is some positive hype around the possibility of the conflict in Ukraine moving toward a compromise, and then with Chinese indications that they will step in where necessary, Asian stocks are already pushed out,” said Sima Shah, chief strategist at Principal Global Investors.

Western governments have imposed tough sanctions on Russia over its invasion of Ukraine, which Moscow described as a “special operation”.

“These sanctions probably work, and we hope they put some pressure on both sides to come around the table and negotiate,” said Gregory Burdon, chief investment officer at Arbuthnot Latham. He added that the invasion may limit the pace of Fed rate hikes this year.

“I don’t see this as a flash in the all-out military conflict, it has caused a huge shock to the oil market.”

See also  The S&P 500 rose to a five-month high Thursday as the Meta leads a tech comeback

Investors expect the US Federal Reserve to raise interest rates by at least 25 basis points amid higher rates later on Wednesday. Traders will also be watching closely the Federal Reserve for details on how it plans to end its bond-buying program.

Data on Wednesday showed US retail sales rose 0.3% in February, as higher gasoline and food prices forced households to cut spending on other goods, potentially limiting economic growth this quarter. Read more

S&P futures rose 1.1%, indicating a strong open on Wall Street.

MSCI World Stock Index (.MIWD00000PUS) It also rose 1.1%, moving away from the one-year lows hit in the previous session. European stocks (.stoxx) 2.65% profit.

MSCI’s broadest index of Asia Pacific shares outside Japan (MIAPJ0000PUS.) It jumped 4.2% after Liu’s comments, which also sent Hong Kong shares (.HSI) 9% increase.

Muhammad Ababhai, an Asia-Pacific trade analyst at City City in Hong Kong, likened the moment to the Fed’s market backing in 2020 or then-European Central Bank President Mario Draghi’s “whatever it takes” speech that halted the eurozone crisis in 2012.

“It’s not that big of an order, but it’s not far off either,” he said.

Chinese stocks (.CSI300) It rose by 4.3%.

US 10-year Treasury yields rose to 2.204% on expectations of a Fed rate hike, the highest since June 2019. The five-year yield rose to 2.149%, the highest since May 2019.

The German 10-year government bond yield rose to its highest level since November 2018 at 0.403%.

Russia has $117.2 million in interest payments due on dollar-denominated Eurobonds on Wednesday. The Finance Ministry said it would pay the sums in rubles if sanctions prevented it from paying in dollars, a move that markets see as a default.

See also  Stock futures drop before expected Fed rate hike

Russian Finance Minister Anton Siluanov said the ball is in the US court on whether payments will be made, and Washington should clarify whether settlements are possible. Read more

The US dollar fell 0.29% against a basket of other currencies, trading at 98.647, and settled against the yen at 118.32, albeit close to a five-year high in the previous session.

Japan reported a wider-than-expected trade deficit in February, as an increase in capacity driven in import costs due to massive supply constraints added to weaknesses in the world’s third-largest economy. Read more

The euro rose 0.35% to $1.0989.

Oil prices have been volatile since the invasion of Ukraine.

Brent crude rose 0.43 percent to $100.31 a barrel, and US crude rose 1.12 percent to $97.50.

Spot gold rose 0.16% to $1,920.38 an ounce.

Register now to get free unlimited access to

Additional reporting by Andrew Galbraith in Shanghai and Tom Westbrook in Singapore. Editing by Simon Cameron Moore, Kim Coogle, Andrew Heavens and Catherine Evans

Our criteria: Thomson Reuters Trust Principles.