Asia Shares to Slip; Tech Stocks Lift U.S. Indexes: Markets Wrap

A pedestrian is reflected in an electronic stock board outside a securities firm in Tokyo, Japan, on Monday, Jan. 4, 2021. Asian stocks climbed to a new record, as technology shares remained strong in the first session of 2021. Photographer: Noriko Hayashi/Bloomberg
A pedestrian is reflected in an electronic stock board outside a securities firm in Tokyo, Japan, on Monday, Jan. 4, 2021. Asian stocks climbed to a new record, as technology shares remained strong in the first session of 2021. Photographer: Noriko Hayashi/Bloomberg (Noriko Hayashi/)

(Bloomberg) — Asian stocks looked set to pull back from an all-time high Friday as investors assessed earnings expectations and the prospect economic growth will be bolstered by more U.S. fiscal spending. The dollar retreated.

Futures slipped in Japan, Hong Kong and Australia. The S&P 500 Index eked out another record high Thursday as tech shares advanced. Risk appetite has gotten a boost this week from President Joe Biden’s push for nearly $2 trillion in additional spending and plans to jump start a federal response to the pandemic. Benchmark Treasury yields remained higher after a small decline in initial jobless claims.

Global equities remain at a record with valuations elevated as earnings continue to roll in. Intel Corp. reported fourth-quarter revenue that topped expectations. Investors continue to bet on another stimulus package from Biden as the president ramps up the federal government response to the viral pandemic.

European Central Bank President Christine Lagarde warned the virus continues to pose a serious risk after policy makers voted to keep pumping unprecedented amounts of stimulus into the economy. U.S. infectious-disease chief Anthony Fauci said the seven-day average of new Covid-19 cases in the U.S. suggests the virus “might actually be plateauing.”

“While the recent rally clearly suggests that some of this recovery is already priced in, we see plenty of scope for investment flows to rotate from cash and other assets towards equities, once the recovery becomes more visible,” said Paul O’Connor, head of multi-asset at Janus Henderson Investors.

On the virus front, Biden unveiled a national strategy to combat the coronavirus, though warned that another 100,000 lives could be lost over the next month. Germany’s coronavirus fatalities passed 50,000 while the U.K. suffered its worst day in the pandemic.

These are the main moves in markets:

Stocks

  • The S&P 500 closed little changed on Thursday.
  • Futures on Japan’s Nikkei 225 slipped 0.2%.
  • Hang Seng futures retreated 0.2%.
  • Futures on Australia’s S&P/ASX 200 Index dropped 0.3%.

Currencies

  • The Bloomberg Dollar Spot Index fell 0.2%.
  • The yen was at 103.52 per dollar.
  • The offshore yuan was at 6.4644 per dollar.
  • The euro bought $1.2166.

Bonds

  • The yield on 10-year Treasuries rose three basis points to 1.11%.

Commodities

  • West Texas Intermediate crude slid 0.5% to $53.06 a barrel.
  • Gold dipped to $1,869.33 an ounce.
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