Morning Bid: What banking crisis? Ending Q1 on a high
March 31 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever.
Asian markets go into the final trading day of the quarter in a buoyant mood, ready to face Friday's barrowload of regional economic data with a sense of optimism and resilience that would barely have been believable a few weeks ago.
Maybe it is just window-dressing for the end of the quarter, but investors are driving risky assets higher across the board, doing their best to make the banking crisis of March 2023 look like a blip in the rear-view mirror.
Another solid performance on Wall Street on Thursday should set the tone for Asian stocks on Friday, with tech again leading the way. U.S. financials was the only S&P 500 sector to fall on Thursday, but they are still up 3% this week, the best week since January.
It remains to be seen how successful U.S. authorities have been in ring-fencing banks from contagion, and there is little doubt that deteriorating credit conditions will be a drag on growth.
Right now though, it's 'risk on' globally - the MSCI Asia ex-Japan equity index is up three weeks in a row, the MSCI World is having its best week since mid-January, and the Hang Seng tech index is at a six-week high.
Although bond yields and the Fed rate outlook have picked up in the last two weeks, they are still significantly below the historic peaks pre-banking shock. Tech, in particular, is on a roll.
Further indications that China is reversing the sweeping regulatory crackdown on its technology sector of recent years is also adding fuel to the rally.
After investors gave Alibaba's restructuring plans this week a big thumbs up, e-commerce firm JD.com said on Thursday it plans to spin off its property and industrial units and list them on the Hong Kong Stock Exchange.
U.S.-listed shares in JD.com jumped 8% on Thursday, U.S.-listed shares of Alibaba are up 20% in the last three sessions, the Nasdaq 100 is flirting with a bull market - up more than 20% from its December low - and the wider Nasdaq is up 15% this year.
On the Asian data front on Friday, investors have no shortage of potential market-movers, including: Chinese PMIs for March; Japanese unemployment, retail sales and industrial production; and private sector credit figures from Australia.
Here are three key developments that could provide more direction to markets on Friday:
- China NBS manufacturing and services PMI (March)
- Euro zone flash CPI inflation (March)
- U.S. PCE inflation (February)
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