(Bloomberg) — Treasuries extended Friday’s sell-off after Federal Reserve Chair Jerome Powell suggested waiting longer before cutting interest rates. Chinese stocks recovered following signs of official support.Most Read from BloombergUS 10-year yields climbed around five basis points in Asia after jumping 14 basis points Friday due to stronger-than-expected payroll data. Powell expressed concern about moving too quickly, stating, “the job’s not quite done,” during an interview on CBS’s 60 Minutes, screened on Sunday in the US.The Treasury declines had a ripple effect across Asian bond markets, impacting government debt in Australia and New Zealand. Chinese government bonds, however, saw 10-year yields falling around two basis points.Hong Kong and mainland China stocks rebounded from earlier losses after the China Securities Regulatory Commission issued a statement on Monday, pledging to closely monitor and implement effective measures to mitigate stock pledging risks. The commission also announced it would act to prevent abnormal fluctuations and guide more medium- and long-term funds into the market.“Whether or not today marks the floor to Chinese equities is yet to be seen but it sure feels as though we’re bumping along the bottom as policymakers have signaled they no longer want to see any further declines,” said David Chao, a strategist at Invesco Asset Management.Benchmarks in Australia and South Korea declined, as did US equity futures after the S&P 500 Index climbed to a new record on Friday. The US benchmark’s strong performance comes as February begins, historically one of the rockiest months of the year for US stocks.The dollar strengthened against most major peers after Powell’s hawkish comments. The yen crept lower to trade at around 148 per dollar.Investor expectations for a rate cut in March by the Fed plummeted Friday to around 20% from almost 40% on Thursday, as economic resilience reduced the likelihood of imminent policy easing.Despite weakening forecasts for a March rate cut, Ed Yardeni, president of Yardeni Research, noted, “this market still expects five rate cuts this year. Fed officials are likely to continue to push back against that notion of so much cutting.”Oil edged higher as the US vowed more strikes against Iran’s forces and proxies while the Houthis promised to retaliate against bombardments over the weekend. Meanwhile, gold weakened.Former US President Donald Trump also indicated he may impose a tariff on Chinese goods of more than 60% if elected, in a fresh round of hawkish rhetoric aimed at the largest supplier of goods to the US.Key events this week include:Eurozone S&P Global Services PMI, PPI, MondayAustralia rate decision, TuesdayEurozone retail sales, TuesdayGermany factory orders, TuesdayCleveland Fed President Loretta Mester, Philadelphia Fed President Patrick Harker speak, TuesdayBank of England Deputy Governor Sarah Breeden speaks, WednesdayFed Governor Adriana Kugler, Richmond Fed President Tom Barkin speak, WednesdayChina PPI, CPI, ThursdayPakistan general election, ThursdayECB Chief Economist Philip Lane, ECB Governing Council member Pierre Wunsch speak, ThursdayEuropean Central Bank publishes economic bulletin, ThursdayUS initial jobless claims, ThursdayUS Treasury Secretary Janet Yellen speaks at a Senate banking committee hearing, ThursdayAustralian Reserve Bank Governor Michele Bullock delivers parliamentary testimony, FridayChina aggregate financing, money supply, new yuan loans, FridayGermany CPI, FridaySome of the main moves in markets:StocksS&P 500 futures fell 0.2% as of 2:32 p.m. Tokyo time. The S&P 500 rose 1.1% on FridayNasdaq 100 futures fell 0.3%. The Nasdaq 100 rose 1.7%Japan’s Topix rose 0.7%Hong Kong’s Hang Seng rose 0.8%The Shanghai Composite fell 0.1%Euro Stoxx 50 futures were little changedCurrenciesThe Bloomberg Dollar Spot Index rose 0.2%The euro was little changed at $1.0779The Japanese yen was little changed at 148.37 per dollarThe offshore yuan was little changed at 7.2109 per dollarThe Australian dollar was little changed at $0.6511CryptocurrenciesBitcoin fell 0.3% to $42,640.83Ether fell 0.4% to $2,289.58BondsThe yield on 10-year Treasuries advanced five basis points to 4.07%Japan’s 10-year yield advanced six basis points to 0.720%Australia’s 10-year yield advanced 12 basis points to 4.10%CommoditiesWest Texas Intermediate crude rose 0.6% to $72.73 a barrelSpot gold fell 0.4% to $2,031.44 an ounceThis story was produced with the assistance of Bloomberg Automation.–With assistance from Richard Henderson and Charlotte Yang.Most Read from Bloomberg Businessweek©2024 Bloomberg L.P.
