Asian shares gained at the start of the new week and the dollar was not far off two-week lows after U.S. Federal Reserve Chairman Jerome Powell unexpectedly used a soft tone in his speech on Friday.
On the other hand, oil prices saw an increase while energy firms suspended production as Hurricane Ida hit America’s southern coast.
Japan’s Nikkei rose 0.9% soon after the bell, and MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.32% in early trading before Chinese markets had opened.
Australia climbed 0.39% and Korea’s Kopsi gained 0.54%.
U.S. stock futures, the S&P 500 e-minis, were barely moved, up 0.04%.
Investors had been waiting to see whether Powell, who was speaking at a symposium in Jackson Hole, Wyoming, would give a clear indication of his views on the timing of the central bank’s tapering of asset purchases or hiking interest rates to start removing monetary stimulus.
However, in his prepared remarks, he offered no indication on cutting asset purchases beyond saying it could be “this year”, causing the S&P 500 and the Nasdaq to close last week at new record highs.
The next big event on traders’ calendars is U.S. nonfarm payroll figures for August due to being published Friday, as Powell has suggested an improvement in the labour market is one major remaining prerequisite for action.
“A strong payrolls print could instigate a debate for a September tapering start,” Rodrigo Catril, senior FX strategist at NAB, said in a note.
The absence of a timetable for tapering caused U.S. benchmark Treasuries and the dollar to slip, and both trends continued on Monday morning in Asia.
The yield on benchmark 10-year Treasury notes was 1.3054% compared with its U.S. close of 1.312%, and the dollar index which measures the greenback against a basket of currencies was around a two-week low.
Investors in China, in contrast, are watching data this week to see whether they will indicate policymakers are more likely to step up easing measures.
Oil was also in focus after energy firms suspended 1.74 million barrels per day of oil production in the U.S. Gulf of Mexico as Hurricane Ida slammed into the Louisiana coast as a Category 4 storm.
U.S. crude rose 0.86% to $69.34 a barrel. Brent crude rose 1.25% to $73.38 per barrel.
Gold was slightly higher, with the spot price gold was traded at $1,817.7863 per ounce, up 0.07%.