Morning Auction: Banks ‘n’ Tech Lead the Way, Out of Sinking

March 30 (Reuters) – A look at the day in Asian markets from Jamie MacGyver.

The recovery from banking shocks this month looks set to gather momentum and carry over to Thursday, with no major economic and policy events on the Asian calendar, allowing investors to pick up where they left off on Wednesday.

This should mean a positive session for risk appetite and stocks on hopes that the banking crisis is easing and investors are responding to Chinese e-commerce giant Alibaba’s sweeping restructuring plans.

Wall Street posted strong earnings on Wednesday, with volatility falling to its lowest level since the U.S. banking crisis three weeks ago. As bond yields increased, bond market volatility decreased and fixed income markets were more stable.

The bullish Nasdaq jumped 1.8% for its best day in two weeks, boosted by positive tech company sentiment. The much narrower Nasdaq 100 is now up more than 20% from December lows. A bull market?


First, bank panics are definitely receding. How long this will last, or whether this is correct or not, is beside the point – after a few weeks of intense volatility and massive losses, the financial issues have stopped bleeding.

The MSCI World Financials Index has now risen for three days in a row and the U.S. regional banking index has risen for four straight days, none since January.

Investors acknowledged Federal Reserve Vice Chairman Michael Barr’s open-spoken congressional testimony on WetestimonyBarr told lawmakers that officials and regulators were caught off guard by the banking crisis and will have no trouble learning the lesson.

Meanwhile, technology is on a tear, thanks in part to Alibaba ( 9988.HK ). China’s congressional restructuring plans announced this week are seen as a sign that Beijing’s crackdown on corporate governance is coming to an end, boosting stocks and boosting investor confidence in Chinese tech companies.

US-listed Alibaba shares rose 2 percent on Wednesday, following Tuesday’s 14 percent rally, and Hong Kong-listed shares rose 12 percent on Wednesday, topping the Hang Seng index and other regional markets.

Here are three key developments that could give markets further direction on Thursday:

– US GDP (Q4)

– Fed’s Collins, Barkin, Kashkari and Waller all speak

-German CPI Inflation (March)

by Jamie MacGyver; Editing by Josie Cao

Our Standards: The Thomson Reuters Trust Principles.

The opinions expressed are those of the author. They do not reflect the views of Reuters News, which is committed to integrity, independence and impartiality under the principles of integrity.

Jamie McGeever

Thomson Reuters

Jamie MacGyver has been a financial journalist since 1998 covering Brazil, Spain, New York, London, and now back in the US. Focus on economics, central banks, policymakers and global markets – especially FX and fixed income. Follow me on Twitter: @ReutersJamie

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