In Asian Equity Markets stocks rose, recovering some of yesterday's largest drop in seven weeks, as Chinese exports and imports unexpectedly climbed and Chair Janet Yellen said the Federal Reserve will continue to support the U.S. economy. Japan Radio Co. jumped 13 percent after profit at the maker of radio equipment surged. SK C&C Co. (034730) climbed 3.9 percent in Seoulas earnings topped forecasts at the provider of information technology services. Galaxy Entertainment Group Ltd. led casino operators lower after a report Macau is facing a capital-flight crackdown amid concerns that illicit funds are being funneled out of the mainland and into casinos. Japan's Topix index climbed 0.9 percent. South Korea's Kospi index rose 0.3 percent as SK C&C gained 3.9 percent to 148,500 won. Australia's S&P/ASX 200 Index rose 0.8 percent. New Zealand's NZX 50 Index slid 0.4 percent. Hong Kong's Hang Seng Index (HSI) climbed 0.5 percent while Shanghai Composite Index rose 1.1 percent.
In Currency Markets Australia's dollar rose to a two-week high after reports on local jobs growth and Chinese trade beat analyst expectations, brightening the outlook for the South Pacific nation's economy. The euro was near a seven-week high with the European Central Bank forecast to keep its benchmark interest rate unchanged today even as President Mario Draghi stepped up rhetoric against the currency's gains last month. The euro has been the best performer of the past year in Bloomberg Correlation Weighted Indexes after the pound and Swiss franc. A dollar gauge was steady before Federal Reserve Chair Janet Yellen speaks before a Senate Budget Committee today. Australia's dollar rose 0.5 percent to 93.73 U.S. cents as of 7:00 a.m. in London and touched 93.76, the strongest since April 23. The euro was little changed at $1.3917 and reached $1.3951 on May 6, the highest level since March 13.
In Commodities Markets West Texas Intermediate traded near the highest price in a week after crude inventories shrank for the first time since March in the U.S., the world's biggest oil consumer. Brent was steady in London. Futures were little changed in New York after rising 1.3 percent yesterday. Crude stockpiles fell by 1.78 million barrels last week as supplies at Cushing, Oklahoma, the delivery point for WTI, dropped to the lowest level since December 2008, the Energy Information Administration reported. Russian President Vladimir Putin called on separatists in Ukraine to postpone a vote for autonomy and said he pulled troops from the country's border after weeks of tension. WTI for June delivery was at $100.79 a barrel in electronic trading on the New York Mercantile Exchange, up 2 cents, at 2:00 p.m. Singapore time. The contract gained $1.27 to $100.77 yesterday, the highest close since April 29. Brent for June settlement was 15 cents lower at $107.98 a barrel on the London-based ICE Futures Europe exchange.
In US Equity Markets the Standard & Poor's 500 Index rose as optimism that the Federal Reserve will continue to support the U.S. economy overshadowed a drop in Internet stocks led by Yahoo! Inc. and Groupon Inc. Electronic Arts (EA) Inc. jumped 21 percent after reporting better-than-forecast results. The Dow Jones Internet Composite Index dropped 1.9 percent to the lowest level since October. Groupon fell 21 percent as sales and profit projections trailed some estimates. Yahoo slumped 6.6 percent as Alibaba Group Holding Ltd. filed for a U.S. initial public offering. Tesla Motors Inc. dropped 5.8 percent in after-market trading. Utility stocks rose 1.6 percent for the best gain among 10 S&P 500 main industries. Financial shares climbed 1.3 percent, rebounding from yesterday's slump, as American Express Co. and Visa Inc. added at least 1.6 percent. Finally, the DJIA finished up 0.72% at 16,518.54, the S&P 500 up 0.56% at 1,878.21 and the NASDAQ 100 down 0.28% at 3546.47.
In Bond Markets Treasuries finished near best levels despite early selling pressure, and the late bid partly in reaction to the appearance at the JEC by Fed Chair Yellen, who side-stepped questions on guidance for an explicit timeframe for the first rate hike, leading to a bid in the short-end, with particular upside in green-pack Eurodollars and bull steepening of the yield curve. At the March FOMC meeting Fed Chair Yellen said that a considerable period between the end of tapering and the first FFR could be viewed as 6-months, however she steered clear from providing an explicit timeframe today, something which is viewed as slightly more dovish than her speech in March. The Yellen inspired bid reversed early weakness in fixed income, which was seen after flows towards riskier assets following news that Russian President Putin was ready to hold talks with OSCE chief and other Western officials, which was interpreted as paving the way for dialogue with the West to reduce conflict between Russia and Ukraine. At the pit close, T-notes settled at 124.28, up 7+ ticks.
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