(BLOOMBERG) – Asian stocks looked set for a mixed open on Thursday (May 20) after United States shares dipped and Treasury yields rose in the wake of Federal Reserve minutes that flagged the possibility of a debate on scaling back asset purchases.
Futures were steady in Japan and Australia but lower in Hong Kong.
US contracts slipped in early Asian trading, after the S&P 500 fell a third day.
The Nasdaq 100 notched a small advance, boosted by late-day gains in tech stocks including Facebook.
The minutes indicated some Fed officials may be open “at some point” to discussing adjustments to the pace of massive bond purchases if the US economy keeps progressing rapidly.
The benchmark 10-year Treasury yield climbed to 1.67 per cent and a gauge of the dollar rose.
Commodity prices slid amid mounting concern about inflation and potential curbs on monetary stimulus.
A bout of volatility swept over cryptocurrencies, with Bitcoin posting a same-day plunge and rally of about 30 per cent. The largest token and other virtual currencies like Ether are nursing losses from a recent selloff. Cryptocurrency-exposed shares including Coinbase Global slid.
Stocks have lost steam in recent sessions on worries about inflation and a Covid-19 resurgence in some countries. Speculative ardour is also waning, underlined most recently by the gyrations in digital tokens.
While US policy makers have signalled they intend to maintain an accommodative stance for a prolonged period, any hints of a timeline for paring back exceptional stimulus could exacerbate such trends.
“There might be a few participants who are getting a little eager to start the discussion, which might be more than the markets were expecting,” said Schwab Centre for Financial Research fixed-income strategist Collin Martin, referring to the Fed minutes.
“For anyone waiting for the taper, this could be a hint it’s coming sooner rather than later.”
Oil slumped to the lowest in three weeks with traders also concerned about growing supply from the US. and Iran.
This week, International Monetary Fund managing director Kristalina Georgieva and European Central Bank president Christine Lagarde speak at the Vienna Economic Dialogue on Thursday.
Euro-area finance ministers and central bank chiefs will also hold an informal meeting this week, while a larger group of EU finance ministers and central bank chiefs will meet on May 22 .
These are some of the main moves in markets:
– S&P 500 futures fell 0.3 per cent as of 8.07am in Tokyo (7.07am in Singapore). The index retreated 0.3 per cent
– Nasdaq 100 contracts shed 0.3 per cent. The gauge rose 0.2 per cent
– Nikkei 225 futures rose 0.1 per cent
– S&P/ASX 200 futures climbed 0.1 per cent
– Hang Seng futures retreated 0.1 per cent earlier
– The Japanese yen was at 109.22 per US dollar
– The offshore yuan traded at 6.4400 per US dollar
– The Bloomberg Dollar Spot Index was steady after gaining 0.5 per cent
– The euro was at US$1.2175
– The British pound was at US$1.4112
– The yield on 10-year Treasuries advanced three basis points to 1.67 per cent
– Australia’s 10-year bond yield rose two basis points to 1.79 per cent
– West Texas Intermediate was steady at US$63.37 a barrel after falling 3.3 per cent
– Gold was at US$1,868.60 an ounce