(Bloomberg) -- The bond selloff continued Monday as Treasury yields climbed and sovereign debt slid in Australia and New Zealand. Most Asian stocks advanced as investors took comfort from positive news on vaccine efficacy.
Benchmark 10-year Treasury yields climbed to the highest in about a a year. A gauge of Asian shares rose as Japanese equities outperformed. S&P 500 contracts fluctuated after the index slipped Friday. The dollar dipped.
Crude oil climbed toward $60 a barrel as wells slowly restarted in Texas after being hit by a big freeze. Bitcoin notched another record over the weekend. Copper hit a nine-year high in a sign of optimism about the global recovery.
Sovereign bonds have slid on expectations that vaccines and more fiscal stimulus will spur the global recovery and inflation. In Israel, the Pfizer Inc. and BioNTech SE Covid-19 shot appeared to stop the vast majority of recipients from infection. Progress against the disease has aided sentiment in the stock and commodity markets, but investors are also asking whether the reflation trade will drive up yields to a point that eventually hurts risk appetite.
Equities are rising on the prospect of further pandemic relief spending as well as “continued dovish rhetoric and more acceptance of early stages of inflation from the Fed before even thinking of moving to a tightening bias,” said Simon Ballard, chief economist at First Abu Dhabi Bank.
Read: Inflation Angst Is About to Rewrite the Stock Market Playbook
Investors will be monitoring this week’s testimony from Federal Reserve Chair Jerome Powell for any sign that he’s troubled by steeper long-term borrowing costs. In Australia, the central bank resumed purchases of three-year securities to defend its yield target.
Benchmark bonds also fell in New Zealand. The country’s sovereign credit rating was upgraded by Standard & Poor’s Global Ratings, boosting the New Zealand dollar.
Some key events to watch this week:
Fed Chair Jerome Powell delivers the central bank’s semi-annual monetary policy report to the Senate Banking Committee on Tuesday.EIA crude oil inventory report is out Wednesday.Bank of Korea monetary policy decision is out Thursday.Finance ministers and central bankers from the Group of 20 will meet virtually Friday. U.S. Treasury Secretary Janet Yellen will be among the attendees.
These are some of the main moves in markets:
Stocks
S&P 500 futures rose 0.1% as of 10:51 a.m. in Tokyo. The S&P 500 index fell 0.2% Friday.Japan’s Topix index rose 1%.Australia’s S&P/ASX 200 Index was flat.South Korea’s Kospi index added 0.4%.Hong Kong’s Hang Seng Index climbed 0.5%.Euro Stoxx 50 futures were little changed.
Currencies
The yen was at 105.55 per dollar.The offshore yuan was at 6.4554 per dollar.The euro was at $1.2133, up 0.1%.The pound traded at $1.4039, up 0.2%.The Aussie was at 78.97 U.S. cents, rising 0.4%.The Bloomberg Dollar Spot Index slipped 0.1%.
Bonds
The yield on 10-year Treasuries rose about four basis points to 1.38%.Australia’s 10-year bond yield rose 13 basis points to 1.56%.
Commodities
West Texas Intermediate crude increased 0.8% to $59.69 a barrel.Gold rose 0.2% to $1,786 an ounce.
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