European Stocks Poised to Track Rally in Asia: Markets Wrap

(Bloomberg) — European stocks were set to track Asian peers higher, in an extension of a recent shift toward non-US assets amid uncertainties unleashed by Donald Trump.

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Contracts on the Euro Stoxx 50 climbed 0.5% while US equity futures retreated. The MCSI Asia Pacific Index advanced for a third session, with benchmarks in Hong Kong rallying more than 2% and Japanese gauges up more than 1%.

Global investors are hunting for opportunities elsewhere after US stocks tipped into a correction earlier this month. Chinese tech stocks are in hot demand and Europe has also benefited, with Germany heralding a bigger shift in the bloc toward expansive fiscal policy. German lawmakers are set to vote on a bill Tuesday that would unlock hundreds of billions of euros in debt-financed defense and infrastructure spending.

Gold rose to a fresh all-time high above $3,017 an ounce. The yield on 10-year Treasuries was little changed as the Federal Reserve is set to kick off a two-day policy meeting. The Bloomberg Dollar Index gained 0.1%.

In Asia, China’s world-beating stock rally may get a fresh catalyst from a slew of tech earnings, with Xiaomi Corp. and Tencent Holdings Ltd. set to report this week. President Trump said Chinese leader Xi Jinping would visit Washington soon.

In Japan, trading houses pushed the market higher after Warren Buffett’s Berkshire Hathaway increased its stake. The Bank of Japan is expected to keep the policy rate at 0.5% at a Wednesday decision, according to economists surveyed by Bloomberg. The yen dropped against the dollar for a third day, inching toward the 150 mark again.

“Market-friendly rhetoric from Beijing provides a more favorable backdrop for Asian stocks today, and the news of increased investment from the likes of Mr. Warren Buffett will certainly help to a degree,” said Homin Lee, senior macro strategist at Lombard Odier. “While the nervous wait for Mr. Trump’s additional trade restrictions and export controls continues,” strong inflows into Hong Kong from mainland buyers will anchor sentiment, he added.

Elsewhere, Indonesian stocks tumbled by the most in over a decade, triggering a 30-minute temporary suspension, amid concerns about a weakening economy and softer consumption.

Retail Sales

Back in the US, retail sales rose by less than forecast in February and the prior month was revised lower. However, the so-called control-group sales — which feed into the government’s calculation of goods spending for gross domestic product — increased 1% last month, reversing the previous drop.