Asian stocks set for mixed trading ahead of Powell

XAUUSD daily chart July 9

SYDNEY, July 10 ― Asian shares inched ahead today while higher Treasury yields lifted the dollar as markets wondered if the world's most powerful central banker would confirm or confound expectations for USA policy easing this month. The dollar weakened. Oil rose above US$59 a barrel in NY. In Japan, however, the Nikkei 225 settled 31.67 points, or 0.2%, to 21,533.48.

Trading may stay choppy ahead of key testimony this week from Federal Reserve Chair Jerome Powell as observers assess prospects for easing following conflicting signals on the global economy.

Traders have rushed to cut back Fed fee lower expectations following unexpectedly robust good points in for June, with USA inventory markets falling for a second straight day.

"The headline payrolls figures were pretty strong but wages were tepid, so, on the whole, a 25 basis-point cut would be justified as a pre-emptive move and I think the current market pricing is fair", said Naoya Oshikubo, senior economist at Sumitomo Mitsui Trust Asset Management.

The Dow Jones Industrial Average was down 22.65 points, or 0.08 percent, to 26,783.49.

Powell testifies to Senate Banking Committee on ThursdayECB minutes are due on Thursday.A key measure of USA inflation - the core consumer price index, due Thursday - is expected to have increased 0.2% in June from the prior month, while the broader CPI is forecast to remain unchanged.US producer prices are due on Friday.

Overnight, Atlanta Fed president Raphael Bostic said the Fed was debating the pros and cons of allowing the world's largest economy to run "a little hotter".

"The real interest is what happens thereafter", Mellor said.

On Wall Street, the S&P 500 lost 0.5% while the Nasdaq Composite dropped 0.8%, led by fall in Apple after a brokerage downgraded the stock to "sell".

The cooling in U.S. rate fever has seen bonds give back just a little of their huge rally, with yields on two-year Treasuries rising to 1.909 percent from the recent trough of 1.696 percent.

The greenback modified arms at 108.75 yen, having risen as much as 108.81 yen within the earlier session, its highest in additional than a month.

That in turn has helped the dollar index against a basket of currencies rebound to 97.500 from a June low of 95.843. Yields on two-year Treasuries rose to 1.917 per cent from their recent low of 1.696 per cent and Europe's benchmark yields up around five basis points. The Mexican peso slid after the country's finance minister announced his resignation.

The Canadian dollar was on the defensive ahead of a rate meeting by the Bank of Canada in case policy makers tried to slow the currency's recent rally.

The dollar's gains took the shine off gold, which eased 0.3 per cent to $1,393.48 per ounce.

Oil prices were supported by Middle East tensions and news that United States stockpiles fell for a fourth week in a row, easing concerns about oversupply. Worldwide benchmark Brent crude futures jumped 0.9% to $64.74 per barrel.

Elsewhere, West Texas intermediate crude gained following a report that Russian output declined.



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