Overnight, Chinese equities have rallied sending property and technology companies listed in Hong Kong on their way to their best week on record, the moves come after Beijing announced monetary and fiscal support for the region’s largest economy. The politburo, led by President Xi Jinping, pledged on Thursday to “issue and use” government bonds to better implement “the driving role of government investment”, the comments coming just as analysts are starting to warn that the Country may be in danger of missing their annual economic growth target. China’s CSI 300 is on track for its best weekly rise since November 2008 and Hong Kong’s broader Hang Seng index is set to have its best week in more than 20 years. The Yen weakened 1% against the dollar and Japanese bond futures rose as speculation that that economic security minister Sanae Takaichi will be the nation’s next leader increased.
In U S markets yesterday, the S&P 500 closed at a record high for the third time this week as equities were on the up prior to today’s economic data. The benchmark index rose 0.4% on the day, enough to recover from Wednesday’s minor loss and notch a fresh record. Materials was the best-performing sector, followed by the technology and industrials sectors.
Elsewhere, Mexico’s central bank voted 4-1 to lower its benchmark interest rate by 25 bps, while also revising down its inflation forecasts for some quarters. Mexico’s economy is slowing and there is high volatility in the peso as the newly elected government pursues constitutional changes.
In commodity markets, Oil extended a two-day drop making for a notable weekly decline, as greater supply from Saudi Arabia and Libya suppressed prices.
Data today includes Eurozone Consumer confidence at 10:00am followed by US PCE at 1:30pm and Michigan consumer sentiment at 3:00pm.
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