Asian stocks rise as USA earnings prop up Wall St

Asian stocks rise as USA earnings prop up Wall St

World markets remained edgy on Thursday, with shares eking out gains amid concern over the global economic outlook and with USA bond yields at four-year highs after breaking above the psychologically significant 3 percent line this week.

Stocks have faded over the past few days as bond yields continued to climb.

Bond yields move higher as bond prices move lower. Stocks are no longer the only game in town. "There is a bit more confidence in the USA and that negatively affects gold, naturally, in terms of geopolitics".

The 10-year Treasury note yield was higher at around 3.028 percent at 7:47 a.m. ET, while the yield on the 30-year Treasury bond was higher at 3.205 percent.

Euro zone bond yields, swept up in the Treasury market momentum, inched down from multi-week highs before the meeting, and the euro firmed off eight-week lows against the dollar.

The yield on the two-year Treasury yield also extended its gains, up to over 2.5 percent. Its breach of the 3 percent level helped focus investors on rising risks for equities, providing a catalyst for a shakeup in stocks that drove the S&P 500 .SPX back into negative territory for the year, down 1.4 percent.

Kuroda has stuck to his well worn dovish script overnight but this is old news, and the USDJPY continues to climb due to the USA dollar bid while triggers some stops along the way above 108.30 level. Australian markets were closed for Anzac Day, a public holiday. But Gold markets are indeed at a bit of an inflexion point given that rising inflationary pressures driven by higher oil prices could lead to a global inflation spark which could be supportive for Gold prices.

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Not all investors were ready to seize on the 10-year's move as the spark to shift money around, especially in the midst of a corporate earnings season that is on track to be the strongest period in more than seven years. "I don't think investors should be abandoning stocks when the economy is growing and earnings are up roughly 20 percent from a year ago". Prominent fixed-income investors like Jeffrey Gundlach at DoubleLine Capital and Scott Minerd at Guggenheim Partners have cited the 3 percent threshold as critical to determining whether the three-decade bull market in bonds is at an end.

Given their expected returns, stocks continue to look relatively attractive, said Jason Ware, chief investment officer at Albion Financial Group in Salt Lake City.

There is also a loose correlation between Treasury yields and auto loans.

United States gold futures gained 0.1 per cent at $1,324.60 an ounce.

Money-market pricing suggests investors expect the European Central Bank to deliver a rate hike by June 2019, having pushed back expectations from early next year.

Taxable bond mutual funds and ETFs have drawn $68 billion in net inflows this year, bringing the total in those funds to $4.9 trillion, according to Lipper. Higher yields make the burden of everything from mortgages to student loans and auto payments even heavier. "Today, the 10-year did claw its way up to 3 percent to no big effect as far as currencies are concerned", said Alan Ruskin, global head of currency strategy at Deutsche Bank in NY.

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