Asian Market Update
Asian Market Update: 10-year Treasury yields are up 1.2 bp at 1.954% after returning from yesterday's holiday, Japanese 10-year rates jumped 4.5 bp to -0.037%, as stock markets recovered. Prime Minister Abe last week ordered his cabinet to put together a stimulus package that will be covered with an extra budget towards the end of the year and with a PBOC adviser also urging fiscal stimulus to accompany rate cuts, signs that globally governments are preparing to up fiscal spending to boost growth are underpinning the move higher in yields. More reports that U.S. President Trump is expected to announce a 6 months delay to tariffs on auto imports also helped to underpin hopes that trade relations are thawing generally. New Zealand bonds outperformed and rallied, however, after another dip in inflation expectations boosted expectations for a rate cut tomorrow. The local 10-year rate is down -2.4 bp at 1.35%. Stock markets meanwhile benefited from stimulus hopes and Topix and Nikkei are up 0.33% and 0.815 respectively so far. The Hang Seng bounced back from yesterday's slump and is 0.5% higher, although ongoing political tensions will continue to disrupt markets. CSI 300 and Shanghai Comp meanwhile are up from earlier lows, but still down -0.15% and unchanged on the day respectively, while the ASX lost -0.29%. U.S. futures are higher though and the front end WTI future moved up to USD 57.13 per barrel.