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By John McCrank
NEW YORK, July 6 (Reuters) - Asian markets looked set to
rise on Tuesday as investors weighed growing expectations of an
economic rebound in China and a resurgent U.S. services
industry, brushing off worries about a spike in U.S. coronavirus
cases.
Australian S&P/ASX 200 futures YAPcm1 climbed 0.52%, while
Japan's Nikkei 225 futures JNIc1 rose 0.07%, and Hong Kong's
Hang Seng index futures .HSI HSIc1 were up 0.68%. E-mini
futures for the S&P 500 EScv1 rose 0.08% following a rally in
global stocks on Monday.
Bullish sentiment toward the Chinese economy propelled the
yuan on Monday to its best day against the dollar since
December, while an index of blue-chip Chinese shares .CSI300
soared to its highest in five years.
Jawboning by the Chinese government through a
state-sponsored journal on the importance of "fostering a
healthy bull market" helped spur the move, said Ray Attrill,
head of FX strategy at NAB, in a research
note. "Shades of John F. Kennedy's 'Ask not what your country can
do for you' inauguration speech here and as close as you might
get to a Chinese government 'put' as anything the Fed has done
to date vis-à-vis the U.S. stock (and credit) markets," he said
in his description of the Chinese report.
Stocks also rallied on a sharp rebound in U.S. services
industry activity in June, almost returning to pre-pandemic
levels, even as new coronavirus cases surged in several states,
forcing some restaurants and bars to close again in a setback to
the budding recovery. On Wall Street, the Dow Jones Industrial Average .DJI rose
1.78%, the S&P 500 .SPX gained 1.59% and the Nasdaq Composite
.IXIC 2.21%. Emerging market stocks rose 2.65% while MSCI's broadest
index of Asia-Pacific shares outside Japan .MIAPJ0000PUS
closed 2.46% higher on Monday.
The Reserve Bank of Australia is expected to hold its cash
rate at 0.25% and make no changes to policy at Tuesday's board
meeting, leaving markets to focus on the accompanying statement.
There will be particular attention on whether the central bank
notes the Australian dollar's rise. The Australian currency was up 0.04% versus the greenback at
$0.698.
Gold edged toward an almost eight-year high hit last week as
the spike in coronavirus cases kept safety demand elevated,
although the rally in stocks and strong U.S. services sector
data limited the metal's advance.
U.S. gold futures GCcv1 settled up 0.2% at $1,793.50 per
ounce.
Brent crude LCOc1 settled up 30 cents at $43.10 a barrel,
while U.S. West Texas Intermediate crude CLc1 fell 2 cents to
settle at $40.63.