Asian equities pared losses as prospects for more monetary stimulus in Japan weakened the yen, while copper led gains in industrial metals and crude oil stayed above $46 a barrel. European stock index futures fell and U.S. contracts advanced.
Shares of energy and raw-materials producers rose on the MSCI Asia Pacific Index, which earlier approached a one-month low amid a slew of disappointing corporate earnings in the U.S. and Japan. The yen lost ground against almost all of its major counterparts after Bank of Japan Governor Haruhiko Kuroda said monetary policy can be eased further if needed. A Japanese exchange-traded fund tracking Brazilian shares held at this month’s high before the South American country’s Senate votes on whether to impeach President Dilma Rousseff. Australia’s dollar slipped toward a two-month low. With pessimism over the global economic outlook and concern over central banks’ firepower already keeping investors on tenterhooks, the corporate earnings season has provided little in the way of support for equity markets, which lost more than $1 trillion in value last week. The euro area and India are scheduled to release industrial output data on Thursday, while U.S. weekly jobless claims figures are also due. The Bank of England is seen leaving interest rates unchanged at a monetary policy review.
The yen weakened 0.5 percent after Kuroda said risks to the world economy are large and monetary policy can be eased further if needed. The Bank of Japan could add to record stimulus in June or July if inflation indicators weaken and stock prices drop. Australia’s dollar fell 0.6 percent versus the greenback. Traders are betting on another interest-rate cut in the next six months after the Reserve Bank of Australia’s unexpected move on May 3. The Aussie’s losses will be limited by investor appetite for higher-yielding AAA-rated assets, keeping the exchange rate in a range.
Copper for three-month delivery on the London Metal Exchange gained 1 percent. Codelco, the world’s biggest producer, sees prices rising toward the end of next year as investment cuts hasten a re-balancing of global supply and demand. The LMEX Metals Index, which tracks the six main metals traded on the LME, gained 0.9 percent on Wednesday, rebounding from a one-month low. Gold fell 0.5 percent, reflecting gains in the dollar. It has surged 20 percent this year as the Fed refrained from raising interest rates and the European Central Bank and Japan stepped up monetary stimulus. A World Gold Council report showed Thursday that global demand in the first quarter was the second-highest on record. Japan’s 30-year government bonds fell after demand weakened at an auction of the debt. The yield on the securities increased by two basis points to 0.32 percent.
Market data – http://www.Nasdaq.com