Asian equities were headed for gains after US stocks rallied on signs of optimism from debt ceiling talks, allowing investors to refocus on the path for interest rates and the health of the banking system.

Share Market Live

NSE

Futures contracts for Japanese and Hong Kong stocks advanced more than 1 percent, while those for Australian shares also rose. US futures were muted in early Asian trading after the S&P 500 and the Nasdaq 100 closed near highs of the day, up over 1 percent.

President Joe Biden expressed confidence there will be no default, and House Speaker Kevin McCarthy said reaching an agreement this week is “doable.” JPMorgan Chase & Co. chief Jamie Dimon said the US government “probably” will not default on its debts after he and other bank leaders met in Washington to discuss the debt limit.

Australian and New Zealand bond yields climbed following a slide in Treasuries. The yield on the two-year US note rose seven basis points, and the 10-year rate added three basis points to 3.56 percent. The Bloomberg dollar index was steady after rising 0.2 percent Wednesday to close at the highest level since March.

Australian employment data due later today are expected to show fewer jobs were created in April than March with unemployment remaining at 3.5 percent. The Philippines is forecast to hold interest rates at 6.25 percent. New Zealand’s finance minister will deliver the country’s budget Thursday, with economists expecting a return to surplus in 2026, a year later than predicted in the December fiscal update.

A rally in regional banks after Western Alliance Bancorp reported growth in deposits boosted sentiment and eased worries about the health of the industry. All members of the KBW Regional Banking index advanced, pushing the benchmark 7.3 percent higher for its best day since January 2021.

In late trading, Cisco Systems Inc. dropped after the networking company reported its third-quarter results and gave an outlook. While the report was better than expected overall, Vital Knowledge noted some weakness in underlying numbers.

Alibaba Group Holding Ltd. results are due later today after Tencent Holdings Ltd. posted its fastest revenue growth in more than a year. Walmart Inc. will report on Thursday in the US.

European Central Bank Vice President Luis de Guindos said the ECB has completed most of its tightening but there is still “a way to go.”

Also Read: Trade Setup for May 18: Nifty 50 eyes buying interest near support zone post lowest close since May 8