© Reuters. FILE PHOTO: A man wearing a protective face mask speaks on his cell phone in front of a screen showing the Nikkei Index in Tokyo
By David Henry
(Reuters) – Shares were flat in early trading Thursday in Asia as investors continued to drag asset price runs after absorbing tepid US inflation data and comments from the Federal Reserve chief confirming prospects for a slow rebound .
The Australian recently gained 0.02% while the e-mini futures rose 0.05%.
“In recent trading sessions, some of the steam ran out of the engine,” said Jarrod Kerr, chief economist at Kiwibank.
“We’ve had a good run, but the data hasn’t kept pace,” said Kerr, predicting that bond yields and stocks will end the year higher after a break in reflation trading.
The break coincides with much of Asia, which is going on extended vacation for the Lunar New Year.
On Wednesday, markets around the globe saw choppy trading and slight movements in most asset prices, with the exception of US Treasuries, which fell after data showed inflation remained cheap in January, disappointing investors who bet on the increasing price pressure.
The benchmark 10-year Treasury yield fell to 1.135% after rising to 1.176%. On Monday the yield had hit 1.2%, an 11-month high.
The move was reinforced when Federal Reserve Chairman Jerome Powell, who pledged to keep interest rates low, said the US labor market was “far from full employment.”
Wall Street stocks shook Powell’s comments. The major indices have barely changed, although the S&P 500 posted a 0.2% gain to a record close of 31,437.80. The S&P 500 was down 0.03% and down 0.25% from a record close the previous day.
Within the indices, there has been another rotation of money from some major technology stocks towards energy stocks, financial stocks, which has increased market leadership.
European stocks also closed lower on Wednesday, with the pan-European index down 0.2%.
The price fell 0.2% after the tame US inflation data and saw its third day of decline on losses against the pound sterling and the euro.[FRX/] Cryptocurrency Bitcoin fell more than 3% to $ 45,140.10 at 23:27 GMT.
Bitcoin hit $ 48,216 on Tuesday after Tesla (NASDAQ 🙂 announced a $ 1.5 billion investment in the virtual currency. [vnL1N2KF0L8]
fell 0.36% to $ 58.47 a barrel early Thursday to hit $ 61.10, up 0.02%.
On Wednesday, oil surged for the ninth day, the longest winning streak in two years, aided by cuts in producer supply and hopes that the introduction of vaccines will fuel demand.
Some remained cautious on the crude oil rally. “The current price level is healthier than the actual market and depends entirely on supply cuts as demand has yet to recover,” said Björnar Tonhaugen of Rystad Energy.
Commodity traders will also be watching platinum, which rose over 5% on Wednesday and hit a six-year high on the outlook for demand from the automotive sector.
Platinum fell 0.3% in early Thursday trading, most recently at $ 1,239.8.
was last up 0.1% to $ 1,843.23. The US gained 0.3% on Wednesday.
“Gold is in a tug of war,” said Edward Meir, an analyst at ED&F Man Capital Markets. While the weaker dollar is bullish, expectations for a big US stimulus package point to higher interest rates, which may keep gold less attractive, he said.