(Bloomberg) – Asian stocks cut earnings from Chinese stocks as Chinese technology stocks fade away as tensions between the U.S. and European Union over tariffs and the Ukrainian war, investors remain cautious.
Most of them come from Bloomberg
Asian stocks rose 0.3% after the highest level since November, while Hong Kong stocks and technology stocks retreated as some investors believe these gains are too high. Cash transactions worldwide are lower due to the president's date in the United States. European Stock Index Futures pointed out a messy disclosure.
The turmoil started this week after DeepSeek's breakthrough in AI prompted Chinese stocks to boost more than $1 trillion in stocks. Investors are also monitoring the ratchet of tensions between the United States and Europe after President Donald Trump's tariff plan sparked a threat of retaliation. Bond futures in Germany and France fell amid concerns that European governments might have to increase military spending.
Investors have accumulated tech stakes, especially in China, amid optimism about DeepSeek's AI app. Monday's meeting between President Xi Jinping and business figures including e-commerce icon Jack Ma was also seen as a catalyst for gains.
“Some investors choose to make a profit because they are very expectant about the meeting between Xi Jinping and private business entrepreneurs,” boutique investment bank Chanson & Co. said Shen Meng, director of the company.
The meeting was “a new event for sales” after two weeks of progress at Vey-Sern Ling, managing director of Union Bancaire Privee.
Goldman Sachs Group Inc. strategists have raised their goal of China's optimism about the country's technological progress. Meanwhile, investor Michael Burry rolled back some of his investments in Chinese tech stocks before DeepSeek broke through.
Trump's tariff plan sparked threats of retaliation, while Vice President JD Vance attacked long-time European allies at a security meeting over the weekend. The plan to end the Ukrainian war has put the group off the court.
Investors may ask officials to seek strengthening military investment advisers demanding higher returns on government debt across Europe. According to Bloomberg Economics estimates, upgrading defense and protecting Ukraine could add an additional $3.1 trillion to Europe's major powers in 10 years. The euro is on Monday's range.
“The scope of further rallies on the European FX is limited,” wrote Barclays PLC analysts led by Sheryl Dong. “The temporary details are negative for European security, with a low war premium.”
Japan's economy expanded for the third consecutive quarter as companies improved their investment and net exports. The yen strengthened its yen for all 10 peers, after surpassing expected headquarters-setting product data, which strengthened the Bank of Japan's expectations for interest rate hiking.
Elsewhere in Asia, Westpac Banking Corp. shares glided as much as 6.2% after profits and margins fell.
Among commodities, oil has steadily declined due to the increase in flows in Iraq and Russia.
Some key events of the week:
U.S. Presidential holiday; bond and stock markets closed on Monday
Australian interest rate decision Tuesday
UK unemployment claims, unemployment rate, Tuesday
Bank of England Governor Andrew Bailey speaks on Tuesday
Canadian CPI, Tuesday
New Zealand interest rate decision, Wednesday
Indonesia interest rate decision, Wednesday
UK CPI, Wednesday
South Africa CPI, Retail Sales, Wednesday
US FOMC Minutes, Housing Begins, Wednesday
Australia lost jobs Thursday
Main interest rates for loans in China, Thursday
Eurozone Consumer Confidence Thursday
G -20 Foreign Minister held in South Africa, Thursday – Friday
Reserve Bank of Australia Governor Michele Bullock and officials testify to the Parliamentary Committee
Japan CPI, Friday
Eurozone HCOB Manufacturing and Services PMI, Friday
UK Standard & Poor’s Global Manufacturing and Services PMI, Friday
US Standard & Poor’s Global Manufacturing and Services PMI, Friday
Bank of Canada Governor Tiff Macklem speaks on Friday
Some major moves in the market:
stock
S&P 500 futures rose 0.2% as of 1:31 a.m. in New York
Nasdaq 100 futures rose 0.3%, climbing for the fourth straight day, the longest winning streak since January 23
Futures at the Dow Jones Industrial Average are barely changing
MSCI World Index has barely changed
MSCI Asia-Pacific Index rose 0.5%, climbing for the fourth straight day, the longest winning streak since February 7
MSCI Emerging Markets Index rose 0.5%, climbing for the fourth straight day, the longest winning streak since February 7
Topix in Japan rose 0.3%, the highest since January 31
Hong Kong's Hun Sen fell 0.1%
Shanghai Composites have risen 0.2% since December 30
EURO STOXX 50 futures barely changed
currency
Bloomberg's market cap index has barely changed
Euro barely changed to $1.0490
Pounds barely changed to $1.2591
The yen rose 0.4% to $151.68
7.2511 per dollar
Cryptocurrency
Bitcoin fell 0.8% to $96,414.31
Ether fell 0.2% to $2,682.85
Bonds
Germany's 10-year yields rose by one basis point to 2.43%
UK's 10-year yields have increased by one basis point to 4.50%
Australia's 10-year yields rose by 4 basis points to 4.45%
commodity
West Texas Intermediate crude rose 0.1% to $70.83 a barrel
Spotted gold rose 0.3% to $2,890.19
West Texas Intermediate crude rose 0.1% to $70.83 a barrel
Spotted gold rose 0.3% to $2,890.21
This story was made with the help of Bloomberg Automation.
– With the assistance of Matthew Burgess, Ruth Carson, Abhishek Vishnoi and Zhu Lin.
(Early versions were corrected to remove references to Treasury transactions)
