Asian Stocks Shrug Off Cohen Plea; Dollar Slips: Markets Wrap

Asian stocks traded mixed and U.S. futures pared losses as traders digested the news of President Donald Trump’s longtime lawyer pleading guilty to federal charges. The dollar slipped and Treasuries were little changed.

Michael D. Cohen’s plea deal had sparked mild demand for haven assets and sent U.S. equity futures lower, though there was little sign of a pronounced impact in markets. Japanese shares traded higher, while Hong Kong stocks pared gains, and they underperformed in China and Australia. Cohen pleaded guilty to illegal campaign finance charges, all but naming Trump as having ordered him to do it. Trump’s former campaign chairman was earlier found guilty of tax fraud, among other charges. Earlier, the S&P 500 Index touched an intraday record high.

“I don’t think that what we saw last night in terms of Manafort and Cohen are necessarily fatal to the president,” Richard Harris, chief executive officer at Port Shelter Investment Management, told Bloomberg TV. “There are quite a lot of things that could continue and he could still ride them out. It takes an awful lot to impeach a president and it may take an awful lot for Trump not to be elected for a second term.”

Next up for global investors are minutes of the Federal Reserve policy-setting policy due Wednesday. Chairman Jerome Powell may provide more color when he speaks Friday at the Kansas City Fed’s annual gathering in Jackson Hole, Wyoming.

Elsewhere, crude held on to gains triggered by a U.S. plan to sell strategic oil reserves that highlighted concerns about tightening global supplies. The Mexican peso and Canadian dollar strengthened after Politico reported the Trump administration is planning to announce Thursday that it has reached a breakthrough in NAFTA talks with Mexico.

Here are some key events coming up this week:

Companies announcing earnings include Alibaba, Royal Bank of Canada, Lowe’s, Target, Qantas and China’s Bank of Communications.Central bankers gather at the Kansas City Fed’s annual Jackson Hole symposium, where Powell speaks Friday.The Fed releases the minutes from latest FOMC meeting on Wednesday.Euro area preliminary PMI data for August is due on Thursday.

These are the main moves in markets:

Stocks

Topix index jumped 0.7 percent as of the break in Tokyo. Hong Kong’s Hang Seng Index was flat.The Shanghai Composite Index fell 0.6 percent.Kospi index rose 0.4 percent.Australia’s S&P/ASX 200 Index fell 0.4 percent.Futures on the S&P 500 Index fell 0.2 percent.The MSCI Asia Pacific Index rose 0.3 percent.

Currencies

The Japanese yen fell less than 0.1 percent to 110.38 per dollar.The offshore yuan declined 0.1 percent to 6.8387 per dollar.The euro traded at $1.1574.The Bloomberg Dollar Spot Index fell less than 0.1 percent.

Bonds

The yield on 10-year Treasuries held around 2.83 percent.Australia’s 10-year yield rose one basis point to 2.54 percent.

Commodities

West Texas Intermediate crude rose 0.5 percent to $66.14 a barrel.Gold was little changed at $1,195.48 an ounce.

–With assistance from Elena Popina, Sarah Ponczek and Jeremy Herron.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Andreea Papuc

SOURCE: Bloomberg.com

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