(Bloomberg) -- Stocks extended a rally in Asia Wednesday amid a dip in the dollar and speculation that the worst of this year’s equity rout may be over.
A gauge of Asian equities added 1.5%, lifted by Japan and Hong Kong, after the S&P 500’s biggest jump since June. US futures pushed higher, encouraged by a late Netflix Inc. surge on a smaller-than-expected subscriber loss.
Chinese share gains were more muted given property-sector and Covid challenges. Traders were also digesting a report that Beijing is preparing to hand down a fine of more than $1 billion to Didi Global Inc. before wrapping up a year-long probe into the ride-hailing giant.
A dollar gauge has shed about 1% this week, underscoring waning haven demand for the greenback and a brighter mood in markets. Treasuries held a decline that’s taken the 10-year yield back above 3%.
The euro hovered around a two-week high against the dollar on the possibility of a bigger-than-expected European Central Bank interest-rate hike Thursday.
Speculation that company earnings will hold up and that the Federal Reserve will avoid very aggressive monetary tightening appears to be giving investors some comfort.
“Stocks have been beaten down,” Kristina Hooper, chief global market strategist at Invesco, wrote in a note. “That doesn’t mean we won’t see more downside for some stock markets around the world, especially given that earnings expectations are likely to be adjusted downward. But I believe we are far closer to the bottom than the top.”
In Europe, Gazprom PJSC is poised to restart gas exports through its Nord Stream pipeline to Europe on Thursday at reduced capacity, as the continent braces for shortages amid the war in Ukraine.
Elsewhere, crude oil slipped below $104 a barrel. Bitcoin hovered above $23,000 after climbing out of a one-month-old trading range.
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Key events to watch this week:
- Earnings this week include Tesla
- US Treasury Secretary Janet Yellen visits South Korea. Tuesday
- Reserve Bank of Australia releases July minutes. Tuesday
- UK Chancellor Nadhim Zahawi and Bank of England Governor Andrew Bailey speak at event. Tuesday
- Bloomberg Crypto Summit in New York. Tuesday
- Bank of Japan, European Central Bank rate decisions. Thursday
- Nord Stream 1 pipeline scheduled to reopen following maintenance. Thursday
Some of the main moves in markets:
- S&P 500 futures rose 0.5% as of 10:43 a.m. in Tokyo. The S&P 500 rose 2.7%
- Nasdaq 100 futures rose 0.5%. The Nasdaq 100 rose 3.1%
- Japan’s Topix index rose 1.8%
- Australia’s S&P/ASX 200 Index gained 1.7%
- South Korea’s Kospi index climbed 1%
- Hong Kong’s Hang Seng Index rose 1.9%
- China’s Shanghai Composite Index rose 0.6%
- Euro Stoxx 50 futures increased 0.4%
- The Bloomberg Dollar Spot Index fell 0.1%
- The euro was at $1.0237, up 0.1%
- The Japanese yen was at 138.01 per dollar, up 0.1%
- The offshore yuan was at 6.7458 per dollar
- The yield on 10-year Treasuries was at 3.02%
- Australia’s 10-year bond yield rose three basis points to 3.54%
- West Texas Intermediate crude was at $103.51 a barrel, down 0.7%
- Gold was at $1,711.53 an ounce