Coronavirus, central banks, currencies in focus

Shares in Asia were set to trade higher at the open following a dramatic bounce back overnight on Wall Street.

Futures pointed to a higher open for Japanese stocks. The Nikkei futures contract in Chicago was at 22,055 while its counterpart in Osaka was at 21,920. That compared against the Nikkei 225’s last close at 21,530.95.

Stocks in Australia were also set to trade higher, with the SPI futures contract at 5,876, as compared to the S&P/ASX 200’s last close at 5,719.80.

Central bank watch

Investors on Tuesday will likely focus on central bank announcements, with the Reserve Bank of Australia set to release the minutes of its recent monetary policy meeting at around 9:30 a.m. HK/SIN. The Bank of Japan is also set to release its monetary policy statement sometime on Tuesday.

The U.S. Federal Reserve announced Monday more measures to support the market. The Fed said it would buy individual corporate bonds, marking a broader approach to corporate bond buying. Previously indicating it would eventually buy bonds on the primary market, Monday’s announcement by the U.S. central bank marked an expansion of that into the secondary market.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.706 after slipping from levels above 97 seen earlier.

Overnight on Wall Street, the Dow Jones Industrial Average closed 157.62 points higher at 25,763.16 while the S&P 500 gained 0.8% to end its trading day at 3,066.59. The Nasdaq Composite advanced 1.4% to 9,726.02.

The moves upward came following a sharp reversal from earlier losses during the trading day on Wall Street, with the Dow dropping more than 760 points before rebounding. The S&P 500 and Nasdaq fell as much as 2.5% and 1.9%, respectively. 

The Japanese yen traded at 107.42 per dollar after seeing highs around 107.1 yesterday. The Australian dollar was at $0.6942 after rising from levels below $0.684 yesterday.

What’s on tap for Tuesday:

  • Australia: Reserve Bank of Australia monetary policy meeting minutes at 9:30 a.m. HK/SIN
  • Japan: Bank of Japan interest rate decision

— CNBC’s Fred Imbert contributed to this report.

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