US stocks rally
US stocks rose as geopolitical tensions faded and investors turned to what is expected to be a blowout corporate earnings season. The dollar fell against most peers.
The S&P 500 Index gained to the highest in almost a month and erased its loss for the year as investors eyed the earnings season after there was no immediate reprisal to the US-led missile strike in Syria and trade concerns took a back seat. The benchmark closed 0.81% higher at 2,677.84, getting a boost from health-care supply companies after a report said Amazon.com Inc shelved a plan to sell drugs. Netflix Inc shares rose more than 5% in after-hours trading after the company reported results.
Treasuries were little changed, while the greenback fell to the lowest since March after US President Donald Trump accused China and Russia of devaluing their currencies.
While geopolitical concerns linger, the focus this week is back on earnings from American corporations and a slew of Federal Reserve officials who are due to speak, including the incoming head of the New York Fed, John Williams. – Bloomberg News.
Haven assets including Treasuries and gold dropped with European core debt, while the pan-European Stoxx 600 Index edged 0.39% lower to 377.74 as traders assessed the military action’s aftermath.
Meanwhile, UK Prime Minister Theresa May will face a second debate in as many days on Britain’s role in bombing Syria on Tuesday (17 April) after she stayed late the night before listening to lawmakers’ views in the House of Commons.
The premier endured six and half hours of proceedings on Monday (16 April) – including more than three hours answering 140 direct questions from members – as she sought to demonstrate her commitment to Parliament in the face of allegations that she had rushed to war without seeking proper approval.
May said there was no time to consult lawmakers before Britain joined US and French airstrikes on Syrian military targets on Saturday (14 April) and dismissed opposition leader Jeremy Corbyn’s accusation that she was acting on “the whims of the US president” as an insult to her government.
“We have not done this because President Trump asked us to do so, we have done it because we believe it was the right thing to do and we were not alone,” May told lawmakers. “We have always been clear that the government has the right to act quickly in the national interest,” she said. “It is my responsibility as prime minister to make these decisions – and I will.” – Bloomberg News.
Japanese Prime Minister Shinzo Abe’s future has come under intense speculation amid a drip-feed of scandals that have prompted a series of public apologies and driven his poll numbers to near record lows. Critics within his Liberal Democratic Party (LDP) are going public ahead of a scheduled vote on the party leadership in September, while his former mentor, ex-premier Junichiro Koizumi, predicted in an interview with the Shukan Asahi magazine that Abe would step down in June.
The prime minister’s travails just six months after leading the LDP to a landslide win are casting doubt on a policy agenda that has over the past five years bolstered Japan’s military and attracted investors with a weaker yen. While LDP would be expected to fend off any election challenge by an opposition that has struggled to unite, Abe’s departure could prompt policy confusion as potential contenders in his own party horse-trade for support.
A weakened Abe heads to Donald Trump’s Mar-a-Lago estate in Florida on Tuesday (17 April) to discuss the US president’s surprise decisions to meet North Korean leader Kim Jong Un and levy tariffs on Japanese steel and aluminum exports. While the visit could provide welcome distraction from the scandals, it may be harder than before to persuade the public that Abe’s charm offensive with Trump is paying off. – Bloomberg News.
The Nikkei 225 Index opened on Tuesday (17 April) morning 0.13% higher at 21,863.85. The benchmark ended its Monday (16 April) trading session 0.26% firmer at 21,835.53.
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