(Bloomberg) -- Asian stocks rose with US equity futures Tuesday amid speculation the Biden administration could scrap some Trump-era tariffs on Chinese consumer goods. Treasuries slid after reopening from a holiday.
An Asian share index climbed for a second day, helped by Chinese tech stocks, while S&P 500 and Nasdaq 100 contracts gained about 0.5% from Friday’s close. US markets were shut Monday for the Independence Day holiday.
The US may announce the rollback of some China levies as soon as this week to counter high inflation. Officials could also unveil a probe into industrial subsidies, which might lead to more duties in strategic areas like technology.
Chinese Vice Premier Liu He held a video talk with US Treasury Secretary Janet Yellen Tuesday morning on tariffs and supply chains.
Commodity-linked currencies strengthened, the yen fell and the dollar fluctuated. In Treasuries, the 10-year yield pushed past 2.95%, extending a global bond retreat that began in Europe on Monday.
Speculation has intensified that President Joe Biden may reduce some Trump-era tariffs on $300 billion in Chinese imports. Policy makers are under pressure to tackle inflation, which has forced interest-rates higher, sapped economic expansion and contributed to steep losses in equities and fixed income this year.
“Markets are likely to react positively on a knee-jerk because at this point we are hungry for any signs of positive news,” said Charu Chanana, senior markets strategist at Saxo Capital Markets Pte. “But we don’t see the move impacting the global growth and inflation dynamics in a significant way.”
Aside from developments related to China, traders are also monitoring Australia’s interest-rate decision. The central bank -- among more than 80 to have raised rates this year -- is expected to implement back-to-back half-percentage point rate hikes for the first time ever.
Elsewhere, Brent crude topped $114 a barrel. Bitcoin retook the $20,000 level.
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What to watch this week:
- Australia rate decision, Tuesday
- PMIs for euro area, China, India among others, Tuesday
- US factory orders, durable goods, Tuesday
- FOMC minutes, US PMIs, ISM services, JOLTS job openings, Wednesday
- EIA crude oil inventory report, Thursday
- Fed Governor Christopher Waller, St. Louis Fed President James Bullard, scheduled to speak, Thursday
- ECB account of its June policy meeting, Thursday
- US employment report for June, Friday
Some of the main moves in markets:
Stocks
- S&P 500 futures rose 0.5% as of 10:55 a.m. in Tokyo. The S&P 500 rose 1.1% Friday
- Nasdaq 100 futures rose 0.7%. The Nasdaq 100 rose 0.7% Friday
- Japan’s Topix index added 0.4%
- Australia’s S&P/ASX 200 climbed 0.3%
- South Korea’s Kospi index rose 1.7%
- China’s Shanghai Composite was steady
- Hong Kong’s Hang Seng index added 1%
- Euro Stoxx 50 futures increased 0.8%
Currencies
- The Bloomberg Dollar Spot Index was steady
- The euro was at $1.0435
- The Japanese yen was at 136.32 per dollar, down 0.5%
- The offshore yuan was at 6.6854 per dollar, up 0.1%
Bonds
- The US 10-year Treasury yield increased eight basis points to to 2.96%
- Australia’s 10-year yield rose eight basis points to 3.64%
Commodities
- West Texas Intermediate crude was at $111.07 a barrel, up 2.4%
- Gold was at $1,811.70 an ounce, down 0.3%