Stocks jump in Asia as the new trading week began after President Obama announced that Democrats and Republicans reached an agreement for the U.S. debt ceiling and cut spending. Gold fell and Treasury bond yields directions. The dollar was mixed.
The Tokyo Stock Market Nikkei-225 index rose 180 points, or 1.8%, to 10,012 about two hours into the trading day Monday. Most of Australia index rose by 1.9%, the South Korean market gained 1.7% and Hong Kong was up 1.5%.
Stocks Obama731 had beaten the world last week in part on fears that the U.S. could default on debt. On Wall Street the Dow Jones Industrial Average fell 4.2% for the week, its worst loss in one year.
Solving the debt crisis would remove a stumbling block for the market. Now investors are expected to shift their attention back to the global economy, which has weakened considerably in recent months.
But for the moment at least, investors are withdrawing from some of the traditional places of refuge and money attracted Washington’s fault drama deteriorated.
Gold futures fell $ 13 to $ 1,615 an ounce in electronic trading Sunday evening, after reaching a record high of $ 1,628.30 on Friday in New York.
The yield on the 10-year Treasuries rose to 2.83% from 2.80% on Friday.
Despite concerns about possible standard – something that had never been a serious threat in the eyes of many analysts – Treasury yields had plunged on Friday after the government gave a sad weak estimate of second quarter economic growth.
Showing that, even if Congress’ impasse over the debt ceiling set the world on edge, Treasuries were maintaining their role as a place for capital to hide in times of economic uncertainty.
The Treasury market may be tested again as one of the three major credit-rating agencies downgrade the rating of the current American AAA grade. It is not clear whether the budget deal reached on Sunday will be enough for the ratings companies, who have warned that the U.S. AAA rating was in jeopardy requirements.
source:latimes
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