Global markets demonstrated resilience as the S&P 500 closed above the 5,500 mark for the first time, marking its 32nd record of the year. The MSCI AC Asia Pacific Index extended its longest winning streak since May, buoyed by gains in key equity benchmarks across Hong Kong, Japan, and Australia, while markets in China and South Korea held steady.
In the United States, futures for the S&P 500 eased slightly after the milestone close, with attention turning to robust performances in megacap stocks. Tesla Inc. surged 10%, propelling the Nasdaq 100 above the 20,000 threshold for the first time. According to Chris Weston, head of research at Pepperstone Group in Melbourne, the latest highs in these indices underscore their psychological significance, buoying sentiment across Asian markets.
Meanwhile, Australia’s three-year bond yield continued its ascent following stronger-than-expected retail sales data, reinforcing expectations of a potential interest rate hike. Oil prices stabilized near a two-month peak, while movements in the Bloomberg Dollar Spot Index and Treasury yields remained subdued.
Investors are closely eyeing upcoming US economic data, including initial jobless claims and ADP employment figures, to gauge the Federal Reserve’s policy stance. Fed Chair Powell emphasized the need for further evidence before considering adjustments to interest rates, despite acknowledging progress in taming inflation.
In Asia, market sentiment hinges on developments in China’s housing market, particularly after lackluster sales reports from major developers. The Caixin Media and S&P Global’s China June composite purchasing managers’ index also showed a slight dip, reflecting nuanced economic conditions.
Looking ahead, market participants are preparing for the US payrolls report, expected on Friday, which could provide further insights into the health of the labor market and potential economic trends. Despite lingering uncertainties, the resilience shown by global equities underscores optimism fueled by corporate earnings and expectations of supportive monetary policies.
