Asia Stocks rose Friday as a rally in a US gauge of Chinese shares aided sentiment, while the dollar ticked up before a speech by Federal Reserve Chair Jerome Powell that’s set to shape views on monetary tightening. Bourses in Japan, Australia and South Korea were in the green. US futures fluctuated after climbs in the S&P 500 and Nasdaq 100 on Thursday. Hong Kong contracts earlier added over 1% and US-listed China equities surged the most in more than two months. Signs of progress toward averting the delisting of Chinese shares in the US over an auditing dispute, along with Beijing’s efforts to step up economic stimulus, contributed to the rally.

The Wall Street session mostly shrugged off a drumbeat of hawkish comments from Fed officials gathering for an annual conference in Jackson Hole, Wyoming. Powell at 10 a.m. Washington time Friday is widely expected to restate the Fed’s resolve to keep hiking interest rates to fight inflation. Treasuries slipped, leaving the US 10-year yield just above 3%. Oil pushed past $93 a barrel. Gold and Bitcoin edged lower.

Also Read: US stocks rally, bond yields fall; traders undaunted by hawkish drumbeat before Powell’s Jackson Hole speech

A rebound in stocks and bonds from June lows has left financial conditions at easier levels than before the Fed began its aggressive tightening campaign. The question is whether Powell will try to reset market expectations to ensure that the brakes continue to be applied to economic activity. “The Fed does have a lot of work to do in terms of just talking markets to price in a potentially higher terminal rate,” Diana Amoa, chief investment officer for long-biased strategies, at Kirkoswald Asset Management LLC, said on Bloomberg Television.

US central bankers at Jackson Hole stressed the need to keep raising rates. Kansas City Fed President Esther George said that a peak higher than 4% can’t be ruled out. The bond market remains divided on whether the Fed will hike by 50 basis points or 75 basis points in September. Jackson Hole may not be a “negative market shock because expectations are hawkish while exposure still low,” said Dennis DeBusschere, founder of 22V Research. “We thought the market correction would be leading into Jackson Hole, and that has largely played out,” he said.

The latest US growth data pointed in different directions in the first half of 2022, adding to the ongoing debate on the health of the economy.

What to watch this week

Fed Chair Powell speaks at Jackson Hole, Friday
US personal income, PCE deflator, University of Michigan consumer sentiment, Friday

Some of the main moves in markets

Stocks
S&P 500 futures fell 0.1% as of 9:30 a.m. in Tokyo. The S&P 500 rose 1.4%
Nasdaq 100 futures fell 0.1%. The Nasdaq 100 rose 1.8%
Japan’s Topix index rose 0.5%
Australia’s S&P/ASX 200 index added 0.4%
South Korea’s Kospi index increased 0.7%
Hang Seng Index futures added 1.1% earlier

Also Read: Sensex, Nifty tank in dying hour of trade; F&O expiry, caution ahead of Jackson Hole symposium pull D-St lower

Currencies
The Bloomberg Dollar Spot Index rose 0.1%
The euro was at $0.9965, down 0.1%
The Japanese yen was at 136.69 per dollar, down 0.1%
The offshore yuan was at 6.8563 per dollar, down 0.1%

Bonds
The yield on 10-year Treasuries rose one basis point to 3.04%
Australia’s 10-year yield fell seven basis points to 3.61%

Commodities
West Texas Intermediate crude was at $93.13 a barrel, up 0.7%
Gold was at $1,755.77 an ounce, down 0.2%