Dollar Holds Gains on Monetary Policy Divergence; Kiwi Declines

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The dollar held gains from last week against most major peers amid speculation the Federal Reserve will raise interest rates as early as April as other major central banks continue monetary easing.

The U.S. currency advanced to match a two-year high versus the euro after European Central Bank Vice President Vitor Constancio told German magazine Wirtschaftswoche that policy makers arent ruling out quantitative easing. The greenback held a three-day gain against the yen after the Bank of Japan maintained unprecedented stimulus last week. New Zealands dollar fell after a gauge of consumer confidence fell.

The dollar traded at $1.2224 per euro at 8:49 a.m. in Tokyo from $1.2229 on Dec. 19, following a 1.9 percent jump in the previous five days. It earlier touched $1.2220, matching the highest since August 2012. The greenback was little changed at 119.55 yen, after gaining 0.6 percent last week. The single currency bought 146.10 yen from 146.15 in New York.

The New Zealand dollar declined 0.2 percent to 77.42 U.S. cents after a Westpac Banking Corp. index of consumer sentiment fell to 114.8 in the fourth quarter, the lowest level since the three months ended March 2013.

Source : Bloomberg

Asian Stocks Advance Third Day as Materials Shares Lead Gains

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Asian stocks rose for a third day, led by materials companies, as crude futures rebounded. Australias benchmark index headed for its biggest two-day gain in three years.

The MSCI Asia Pacific Index rose 0.3 percent to 137.34 as of 9:05 a.m. in Tokyo. The gauge jumped by the most in two months on Dec. 19 amid a global equities rally after the Federal Reserve last week pledged to be patient on the timeline for interest-rate increases. Australias S&P/ASX 200 Index was set for a 3.5 percent two-day gain, the most since December 2011.

Japans Topix index and South Koreas Kospi index added 0.3 percent. New Zealands NZX 50 Index climbed 0.1 percent. Markets in China and Hong Kong have yet to open. Brent crude rose 0.1 percent to $61.45 a barrel after rallying the most since October 2012 on Dec. 19.

Source : Bloomberg

Japanese Stocks Gain a Third Day as Oil Price Rises, Yen Weakens

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Japanese stocks rose for a third day, led by energy companies after crude oil prices gained and the yen held losses against the dollar.

The Topix added 0.5 percent to 1,417.10 as of 9:01 a.m. in Tokyo as all but two of its 33 industry groups advanced. The measure has erased it losses for December and is on course to rise 8.7 percent this year. The Nikkei 225 Stock Average gained 0.2 percent to 17,651.33 today. The Bank of Japan releases its December economic report today. The yen traded at 119.50 per dollar after weakening for three sessions last week as the Federal Reserve said it will be patient in raising U.S. interest rates.

The Standard & Poors 500 Index jumped 3.4 percent last week after the Fed comments sparked a three-day rally in U.S. stocks. Futures on the gauge were little changed today.

The BOJ last week maintained the expansion of its monetary base at an annual pace of 80 trillion yen ($676 billion).

Brent crude oil increased 0.7 percent to $61.79 a barrel after rallying on Dec. 19 by the most since October 2012.

The U.S. updates on third-quarter gross domestic product tomorrow, with economists surveyed by Bloomberg predicting annualized growth will be revised up to 4.3 percent for the three-month period, from a previous estimate of 3.9 percent. Data on housing, goods orders and personal consumption in the worlds largest economy are also due this week.

Fed Chair Janet Yellen said last week that policy makers are likely to hold key rates near zero at least through the first quarter, even as the U.S. economy strengthens. The central bank, in a statement after its last meeting of 2014, replaced a reference to borrowing costs staying low for a œconsiderable time with a pledge to be patient on the timing.

Source : Bloomberg

S&P 500 Climbs Near Record Close After Three-Day Rally on Fed

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U.S. stocks rose, sending the Standard & Poors 500 Index near its all-time high and erasing losses for December, after the Federal Reserve spurred the biggest three-day jump since 2011.

The S&P 500 added 0.5 percent to 2,070.64 at 4 p.m. in New York, erasing all its losses for the month and approaching its previous closing high reached Dec. 5. The benchmark gauge is up 3.4 percent for the week, the most since October.

Trading in S&P 500 companies was 52 percent above the 30-day average for this time of day. Some futures and options on stocks and indexes expire today in a process known as quadruple witching. That often increases volatility and trading volume.

Following the Feds pledge to be patient on the timing of interest-rate increases, the Bank of Japan held monetary policy steady today, almost two months after boosting stimulus as Asias second-largest economy slumped into a recession. In Europe, almost all economists project the central bank will announce the purchase of large-scale government bonds next year.

Source : Bloomberg