(Bloomberg) -- Stocks climbed around the globe and bonds fell after the Bank of Japan moved to reassure markets in the wake of historic volatility sparked in part by the Asian nation’s unexpected rate hike last week.
Equities extended their rebound as the panic that recently roiled the financial world subsided. The yen slumped after a BOJ official indicated that policymakers won’t raise rates further if markets are unstable. Treasuries slid, and roughly 15 companies looked to sell U.S. investment-grade debt as borrowers take advantage of a primary market that was left wide open after the global turmoil shut the issuance window.
Japan’s reassurance came on the heels of massive swings in the country’s stock prices over the past week, as benchmark indexes plunged into bear markets before rebounding sharply. The moves were compounded by the view the U.S. Federal Reserve will cut rates more aggressively than previously thought, prompting traders to rapidly unwind once-popular yen-funded carry trades — including crowded positions in U.S. tech stocks.
“Investors are making a more sober assessment of the events over the past week or so,” said Fawad Razaqzada at City Index and Forex.com. “That’s not to say we are completely out of the woods just yet. But there’s at least some stabilisation in the markets, which should allow some markets to re-align with the fundamentals.”
The S&P 500 rose one per cent. Meta Platforms Inc. is selling high-grade bonds in as many as five parts for general corporate purposes. Super Micro Computer Inc. tumbled 15 per cent on disappointing earnings. Airbnb Inc. warned of slowing demand from U.S. vacationers. Walt Disney Co. gave a mixed picture as it reported results, with weakness at its famed theme parks offsetting its first-ever profit in streaming.
Treasury 10-year yields advanced five basis points to 3.94 per cent. The Japanese yen fell two per cent.
Key events this week:
• Germany industrial production, Thursday
• U.S. initial jobless claims, Thursday
• Fed’s Thomas Barkin speaks, Thursday
• China PPI, CPI, Friday
Some of the main moves in markets:
Stocks
• The S&P 500 rose 1.1% as of 9:30 a.m. New York time
• The Nasdaq 100 rose 1.6%
• The Dow Jones Industrial Average rose 0.7%
• The Stoxx Europe 600 rose 1.6%
• The MSCI World Index rose 1.2%
• Bloomberg Magnificent 7 Total Return Index rose 1.8%
• The Russell 2000 Index rose 1.3%
Currencies
• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.0922
• The British pound rose 0.2% to $1.2717
• The Japanese yen fell 1.9% to 147.12 per dollar
Cryptocurrencies
• Bitcoin rose 1.2% to $57,248.31
• Ether fell 0.9% to $2,466.79
Bonds
• The yield on 10-year Treasuries advanced five basis points to 3.94%
• Germany’s 10-year yield advanced eight basis points to 2.28%
• Britain’s 10-year yield advanced five basis points to 3.97%
Commodities
• West Texas Intermediate crude rose 1.9% to $74.60 a barrel
• Spot gold rose 0.4% to $2,401.41 an ounce
This story was produced with the assistance of Bloomberg Automation.
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