SINGAPORE: Japanese stocks led gains for Asian markets on Thursday, bolstered by strong demand at a government bond auction, while the US dollar recovered from a five-week low.
The Nikkei 225 rose 2.2%, led by a nearly 12% gain for industrial robot manufacturer Fanuc Corp, while MSCI's broadest index of Asia-Pacific shares outside Japan was flat, weighed down by declines in Korea and New Zealand.
In early European trade, pan-region futures were up 0.6%, German DAX futures rose 0.6%, and FTSE futures gained 0.31%.
Tokyo's latest debt sale attracted the strongest demand in more than six years, helping to steady investor nerves after a selloff pushed yields on super-long-dated bonds to record highs earlier in the week. Bond yields rise when prices fall.
"The 30-year JGB auction was unexpectedly strong," said Shoki Omori, chief desk strategist for rates and FX at Mizuho in Tokyo. "The extent of prior selling appears to have imparted a sense of valuation cheapness, thereby encouraging demand." However, he noted that sentiment for longer maturities "remains fragile," and further solid auctions would be needed to improve the outlook. The yield on the 30-year Japanese government bond was last down 4.0 basis points at 3.38%.
The US dollar was up 0.1% at 155.32 against the yen, recovering some ground after Reuters reported that the Bank of Japan is likely to raise interest rates in December, with the government expected to support such a move.
S&P 500 e-mini futures were little changed as momentum from US markets overnight petered out in Asia. Weaker-than-expected economic data cemented expectations that the Federal Reserve will cut interest rates next week. The Russell 2000 index jumped 1.9%, and the S&P 500 rose for a second day, supported by a sharp drop in US private payrolls.
The US dollar index, which measures the greenback against a basket of six currencies, was last up 0.1% at 98.99, snapping a nine-day losing streak.
The Chinese yuan edged 0.1% lower to 7.064 yuan against the US dollar in offshore trading, while the Australian dollar strengthened 0.1% after data showed household spending surged in October. — Reuters
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