The US dollar is up while the Treasuries retreated and stocks rise as an appetite for risk returned to global markets after an anticipated North Korean missile test failed to materialize and Hurricane Irma struck the U.S. with less force than feared. Gold, the yen and Swiss franc all fell.
Bloomberg’s dollar index was headed for the first increase in eight days, while U.S. stock futures rose and Treasuries slipped after Irma weakened and shifted direction to spare Miami a direct hit. The Stoxx Europe 600 Index jumped the most in more than a week as all the region’s major stock gauges advanced and almost every sector gained. Earlier, equities across Asia traded in the green. Oil advanced as Gulf Coast refining capacity continued to recover after getting hit by Harvey.
Pyongyang warned of retaliation if the UN Security Council approves harsher sanctions over its recent nuclear test in a vote on Monday. The regime “is closely following the moves of the U.S. with vigilance,” the North’s state-run Korean Central News Agency said Monday.
“The better risk environment has seen Treasury yields move higher while the yen retreated,” wrote Chris Scicluna, head of economic research at Daiwa Capital Markets in London in a client note. Hurricane Irma appears “not to be quite as catastrophic as had been feared last week” and “thankfully there was no bad weekend news out of North Korea either,” he said.
Chinese stocks closed on a steady note after August inflation data released over the weekend came in better than expected, mainly on account of higher material costs.
The benchmark Shanghai Composite index rose 11.18 points or 0.33 percent to 3,376.42 while Hong Kong's Hang Seng index was up over 1 percent at 27,954 in late trade.
Japanese shares closed at their highest level in more than a week as the dollar recovered from a 10-month trough against the yen and data showed Japanese core machinery orders rose in July at the fastest pace since January 2016.
The Nikkei average jumped 270.95 points or 1.41 percent to 19,545.77, led by gains in recently battered automakers and financial stocks. The broader Topix index closed 1.17 percent higher at 1,612.26.
Australian shares rose sharply as banks and energy stocks rallied, helping more than offset weakness in the mining sector.
The benchmark S&P/ASX 200 index jumped 40.50 points or 0.71 percent to 5,713.10 while the broader All Ordinaries index finished 35.70 points or 0.62 percent higher at 5,775.10.
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