Asian Stocks Eye Early Gains as Rate Cut Bets Firm: Markets Wrap

(Bloomberg) — Big tech was primed for gains after a three-day slump as new artificial intelligence chips boosted Nvidia Corp. and Advanced Micro Devices Inc. GameStop Corp. doubled in a return of the meme-stock craze.

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Nasdaq 100 Index futures added 0.4% in early US hours, signaling a recovery after last week’s 1.4% selloff, which was driven by investors pulling out of expensive tech leaders. S&P 500 contracts added 0.2%. Yields on 10-year Treasuries fell for a third day. The dollar strengthened.

Elections dominated the newsflow on Monday with results from Mexico and India swaying local markets. India’s Sensex jumped more than 3% and the rupee strengthened the most in a year on speculation a decisive victory would allow Modi to push through policies to spur growth. In Mexico, the peso slid after Claudia Sheinbaum became the country’s first female leader in a landslide victory.

Meanwhile, GameStop was back to the forefront after famed Redditor Keith Gill posted what appeared to be a $116 million position in the stock. It was the account’s first post in three years. The screenshot, which also included 120,000 call options, couldn’t be verified. AMC Entertainment Holdings Inc. jumped almost 30%.

After the S&P 500 posted gains in six of the past seven months, there’s a split among some of the top Wall Street strategists over whether the rally can continue. Investors betting on more US gains over the coming months will be disappointed, according to strategists at JPMorgan Chase & Co. On the opposing end, Morgan Stanley’s Michael Wilson says his bull case is in play for now.

“We see the market upside capped during summer due to the inconsistency between the consensus call for disinflation, and at the same time, the belief in no landing and in earnings acceleration,” a JPMorgan team of strategists led by Mislav Matejka wrote in a note to clients.

JPMorgan, Morgan Stanley Split on Outlook for Equity Gains

At a conference in this week in Taipei, Nvidia and AMD chiefs showcased new generations of the chips powering the global boom in AI development. Nvidia added 2.8% and AMD gained 1.4% in early US trading.

Elsewhere, online fashion retailer Shein is set to file for an initial public offering in London as soon as this week that could value the company at about £50 billion ($64 billion), according to a person familiar with the matter. Shein’s offering could become one of the UK’s biggest ever IPOs, clawing back a chunk of the market value London has lost from companies shifting their primary listings to New York.

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Some key events this week:

• US construction spending, ISM Manufacturing, Monday

• International Atomic Energy Agency board meets in Vienna, Monday

• South Korea CPI, Tuesday

• Germany unemployment, Tuesday

• South Africa GDP, Tuesday

• Brazil GDP, Tuesday

• US factory orders, JOLTS, Tuesday

• Australia GDP, Wednesday

• South Korea GDP, Wednesday

• China Caixin services PMI, Wednesday

• Eurozone S&P Global Services PMI, PPI, Wednesday

• Canada rate decision, Wednesday

• Eurozone retail sales, ECB rate decision, Thursday

• China trade, forex reserves, Friday

• Eurozone GDP, Friday

• Mexico CPI, Friday

• Chile copper exports, trade, CPI, Friday

• US unemployment rate, nonfarm payrolls, wholesale inventories, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 6:53 a.m. New York time

• Nasdaq 100 futures rose 0.5%

• Futures on the Dow Jones Industrial Average fell 0.2%

• The Stoxx Europe 600 rose 0.4%

• The MSCI World Index rose 0.1%

Currencies

• The Bloomberg Dollar Spot Index rose 0.3%

• The euro fell 0.1% to $1.0837

• The British pound fell 0.2% to $1.2717

• The Japanese yen rose 0.3% to 156.86 per dollar

Cryptocurrencies

• Bitcoin rose 1.6% to $68,893.76

• Ether rose 0.6% to $3,808.5

Bonds

• The yield on 10-year Treasuries declined three basis points to 4.47%

• Germany’s 10-year yield declined four basis points to 2.63%

• Britain’s 10-year yield declined four basis points to 4.28%

Commodities

• West Texas Intermediate crude fell 0.4% to $76.90 a barrel

• Spot gold rose 0.1% to $2,330.71 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Matthew Burgess.

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