SYDNEY (Reuters) – Asian stocks were trading on all sides in Asia on Monday when investors cautiously welcomed news that a deal had been struck on a long-awaited U.S. stimulus bill, despite talks Brexit “difficult” to move forward with no agreement in sight.
Sterling slipped 0.8% to $ 1.3408 after several European countries closed their borders to the UK as the country went into a tighter lock to fight a new strain of coronavirus.
Prime Minister Boris Johnson will chair an emergency response meeting on Monday to discuss international travel and the flow of goods into and out of Britain.
In the United States, U.S. Republican Senate Majority Leader Mitch McConnell said an agreement had been reached with transportation leaders on a COVID-19 aid bill of about $ 900 billion.
The news saw futures for the S&P 500 first, only to return to flat as the morning went on.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell on both sides of a flat after hitting a series of top peaks. Japan ‘s Nikkei added 0.5% to its highest level since April 1991.
Analysts at BofA noted that a whopping $ 46.4 billion went into equities in the most recent week, with cash outflows the largest in four months. There were higher flows in technical segments and large flows to consumer sector, healthcare, finance, real estate and value stock.
BofA chief investment officer Michael Hartnett said the “sell signal” was encouraged for the first time since February as cash rates fell to 4.0% in the latest Global Asset Manager Review.
“The situation is expanding too much as policy support and profits are rising,” he said in a note. “Expectations for higher growth, inflation and lower interest rates have reached a consensus and investors are setting for a very volatile position of low volatility and high growth. ”
CROWDED EXCHANGE
Another popular trade has been shortening the U.S. dollar and once again the situation looked overwhelmed by many measures, giving the currency some relief on Monday.
“FX markets are awaiting the final results of a possible Brexit deal and the U.S. fiscal package,” said Ned Rumpeltin, European head of FX strategy at TD Securities.
“We are still tired of going out of USD sales‘ good news ’USD knejerk on all sides, however. These factors look full price and short-USD trading is showing more and more. ”
The dollar index rose slightly to 90.147 and away from last week’s pool of 89.723, which had been at its lowest level since April 2018.
The euro likewise bounced back to $ 1.2216, while the dollar overshadowed the yen at 103.45.
The dollar also received a lift from a Nikkei report that Japanese Prime Minister Yoshihide Suga told Finance Ministry officials in November to ensure the dollar does not fall below 100 yen.
With the stoppage in the dollar declining gold prices saw some of their recent gains at $ 1,883 an ounce. [GOL/]
Oil prices ran into profit after reaching seven weeks of gains, with travel restrictions in Europe another blow to demand. [O/R]
U.S. crude traded 79 cents to $ 48.31 a barrel, while Brent crude futures fell 70 cents to $ 51.56.