Dollar Weakens as Trade-Driven Moves Moderate
The dollar weakened for a second session while equities slipped, as large market moves earlier in the week driven by the US-China tariff truce moderated.
The greenback fell against major currencies, with the yen and Swiss franc among the beneficiaries. The 10-year Treasury yield was slightly lower after declining 10 basis points Thursday, as traders priced in two Federal Reserve rate cuts this year. Australian and New Zealand yields fell.
The tepid action signaled caution after a strong week for risk assets following US-China trade talks. Coming into Friday’s session, a gauge of global stocks had advanced for seven days in a row to a level not seen since February when it set a record.
Shares in Taiwan, Australia and South Korea rose, while those in Japan whipsawed and stocks in China fell. US equity futures were flat after the S&P 500 gained 0.4% on Thursday, helped along by defensive dividend-payers that had underperformed in the past month. Meta Platforms Inc. paced losses in Big Tech on Thursday after a news report it was delaying the rollout of a flagship AI model.
Alibaba Group Holding Ltd. shares fell as much as 6.7% in Hong Kong after quarterly revenue disappointed.
“It’s a bit directionless now,” said Vey-Sern Ling, a managing director at Union Bancaire Privee. “Markets needed new catalysts after the US-China tariff walk-back over the weekend and was looking to China tech earnings this week to sustain the rally, but Alibaba’s result last night wasn’t able to provide the lift.”.
Currencies
The Bloomberg Dollar Spot Index fell 0.1% The euro rose 0.1% to $1.1199 The Japanese yen rose 0.2% to 145.37 per dollar The offshore yuan was little changed at 7.1989 per dollar.
Cryptocurrencies
Bitcoin rose 0.4% to $103,898.61. Ether rose 1.3% to $2,570.83.
Source: Bloomberg
