Reuters: Asian shares rallied for a fourth straight session on Monday after markets priced in earlier rate cuts in the United States and Europe, bullish wagers that will be tested by a swarm of central bank speakers this week.Battered bond markets also enjoyed a welcome recovery as a benign U.S. payrolls report and upbeat productivity numbers suggested the labour market was cooling enough to obviate the need for further rate increases from the Federal Reserve.
Japan’s Nikkei rose another 2.4%, after jumping 3.1% last week, while South Korea climbed 4.3% as authorities re-imposed a ban on short-selling to mid-2024. Chinese blue chips gained 1.3%, ahead of data on trade and inflation due this week. S&P 500 futures and Nasdaq futures were both flat. EUROSTOXX 50 futures were also little moved, while FTSE futures inched up 0.1%. Two-year Treasury yields paused at 4.86%, after falling 17 basis points last week. Yields on 10-year notes stood at 4.
Like other risk-sensitive currencies, the rand often takes cues from global factors like U.S. monetary policy. “Given how overvalued the USD is, the prospect of rate cuts in the coming quarters could trigger a deeper correction through the months ahead, and the ZAR is poised to capitalise,” Greeff added. Locally, South African private sector activity fell in October after holding steady in September, hurt by weak customer demand and high fuel prices, a survey showed on Friday.
Kazuo Ueda, the central bank’s governor, will continue to dismantle its ultra-loose monetary policy and look to exit the decade-long accommodative regime next year, Reuters reported on Thursday, according to six sources familiar with the central bank’s thinking. Another piece of economic data released on Friday also depicted a slowing economy. The U.S. services sector slowed for a second straight month in October, according to the Institute for Supply Management.