MSCI’s broadest index of Asia-Pacific stocks outside Japan rose 0.85% in early trading, moving away from a more than five-week low hit the previous day.
The Nikkei Average, Japan’s benchmark, opened 1.16% higher, and e-mini stock futures on the Nasdaq and S&P500 each rose nearly 1.5%.
“I think the green we’re seeing this morning isn’t necessarily a function of people moving back into risky assets,” said Kerry Craig, global market strategist at JPMorgan Asset Management.
“It’s just normal behavior on the very big selloff to get some reprieve and some breathing space that passes because basically nothing has changed on the macro front in the last week.”
Chinese blue chips rose 0.5%.
Central banks around the world are looking to raise interest rates aggressively to rein in rising inflation, a sentiment underscored on Tuesday by Reserve Bank of Australia (RBA) Governor Philip Lowe, who said in a speech that further rate hikes would be necessary.
“As we plot our way back to 2-3% inflation, Australians should prepare for further interest rate hikes,” Lowe warned. “The level of interest rates is still very low for an economy with low unemployment and high inflation.”
Still, Australia’s S&P/ASX 200 index climbed 1.12% in early trading. The Aussie dollar rose 0.3% on the news before paring its gains.
The euro also gained 0.25% on improving risk sentiment, after European equity markets posted modest gains on Monday to claw back some of last week’s hefty losses. American markets were closed for a public holiday.
The Dollar Index, which tracks the greenback against six major currencies, fell slightly to 104.29. The Japanese yen remained under pressure at 135.07 yen per dollar, not far from a 24-year low of 135.58 yen hit early last week. [FRX/]
In bond markets, the yield on the benchmark 10-year US Treasury was 3.2976%, up slightly from last Friday’s close.
Last week’s 3.495% spike was the highest 10-year yield since 2011, and came the same day the Fed raised interest rates by a whopping 75 basis points.
Oil prices rose as traders focused on insufficient supply amid slowing global economic growth. US crude rose 2.12% to $111.88 a barrel and Brent was at $115.56, up 1.25% on the day.
The United States is in talks with Canada and other global allies to further restrict Moscow’s energy revenues by imposing a price cap on Russian oil without spillovers to low-income countries, the secretary said Monday. at Treasury Janet Yellen.
Spot gold added 0.1% to $1,840.40 an ounce. US gold futures % $1,835.60 per ounce.
Bitcoin was at $20,500, having failed to break strongly above the psychologically significant $20,000 level in recent days.