Asian stocks dwindle, US Treasury yields refresh 11-week top ahead of Fed Chair Powell

Market sentiment remains sluggish amid mixed clues, wait for key catalysts.
Evergrande teases traders on coupon payment day, Fed eyed to confirm bullish bias.
NZ, Japan data came in mixed, German IFO, US housing figures left to decorate calendar.

Risk appetite struggles for fresh clues during early Friday. The lackluster moves, mostly on the dull side, follow the previous day’s stellar performance.

Market’s anxiety before Evergrande’s scheduled bond coupon payment joins comments from China’s National Development and Reform Commission (NDRC) suggesting issues of rising raw material prices and power to probe the bulls. On the same line are the scheduled speeches from the US Federal Reserve (Fed) officials, including Chairman Jerome Powell and Vice Chair Clarida.

While portraying the mood, stocks in Asia-Pacific trade mixed with markets in China, Australia and New Zealand flashing mild losses. On the other hand, the US 10-year Treasury yields refresh 11-week top to 1.451%, following the heaviest daily jump since February. Additionally, S&P 500 Futures print 0.05% intraday gains by the press time.

That said, the Fed’s rate hike and tapering signals, coupled with Chinese help to Evergrande and progress over the US $3.5 trillion stimulus talks triggered risk-on mood the previous day. The same weighed down the US Dollar Index (DXY) the most in a month, unchanged around 93.10 at the latest.

Looking forward, traders await news from Evergrande and confirmation of the latest hawkish appearance by the Fed to stay positive and weigh on the US dollar, favoring Antipodeans. Also important are the German IFO data for September and US New Home Sales for August.

Read: US 10-year Treasury yields poke 11-week top after the biggest jump since February

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