Stocks Tick Higher as Yields Rise After BOJ Hike: Markets Wrap

Pedestrians cross a road in Tokyo. Photographer: Shiho Fukada/Bloomberg Photo by Shiho Fukada /BloombergArticle content(Bloomberg) — US stocks are poised to close out a choppy week on a steady note as traders gear up for the year-end stretch that’s typically supportive of equities. Bond yields advanced following the Bank of Japan’s interest-rate hike.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentS&P 500 futures rose 0.2% after the benchmark posted its biggest gain of the month on Thursday. Nasdaq 100 contracts climbed 0.3%. Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentOracle Corp., long a focal point of concerns that the artificial-intelligence rally had become overheated, rose more than 5% in premarket trading. The company is leading a group of investors that signed binding agreements to bring TikTok’s US operations under an American-controlled venture.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentOptions expiries on Friday represent the last major event before markets enter the holiday period, when low volumes, seasonal flows and limited news tend to bolster stocks. Before that, however, a record $7.1 trillion in notional open interest will roll off across the US options market.Article contentStocks have swung in recent weeks as optimism over the outlook for Federal Reserve interest-rate cuts and a robust economy have clashed with fears that the AI-driven rally is vulnerable to a correction. Some strategists warn that while the broader backdrop remains favorable, volatility may persist.Article content“While the conditions for a Santa rally are broadly in place, markets may need a fresh catalyst,” said Francisco Simón, European head of strategy at Santander Asset Management. “In that context, a renewed positive trigger — potentially linked to encouraging news in the AI space — could help reignite momentum.”Article contentArticle contentStill, investors’ optimism is showing through in near-record flows into American stocks. US equities saw inflows of almost $78 billion in the week ended Dec. 17, Bank of America Corp. said in a note citing data from EPFR Global.Article contentTech contributed to inflows for the first time in three weeks, suggesting that fears over potentially overblown AI stock valuations have diminished. BofA strategist Michael Hartnett said equity bulls are positioned for the economy to run “hot” next year on expectations of lower rates, tariffs and taxes.Article contentMeanwhile, bond yields rose almost everywhere after the BOJ Governor Kazuo Ueda’s policy board lifted its key rate to the highest level in more than three decades and signaled that further hikes could be in the offing. Japan’s 10-year yield climbed to the highest level since 1999, with the BOJ making clear that the tightening cycle will continue if the economy performs as expected.Article contentUS Treasury 10-year yields rose three basis points to 4.15%. Germany’s 30-year rate extended an advance and traded at the highest level since 2011.Article contentDespite the rise in yields, the yen led losses among major currencies against a stronger dollar, as traders were left disappointed by the lack of clear guidance on when BOJ officials might tighten policy again.Trending Tax Court overturns CRA decision to deny bitcoin loss writeoff Taxes Mortgage rates move — but in the wrong direction Mortgage Rates When sinking property values raise red flags for borrowers Mortgages Philip Cross: The sad story of Justin Trudeau’s 'youthful idiots' FP Comment Amid a wave of mortgage renewals, borrowers will have leverage in 2026 Mortgages Article content“The market had expected a hawkish hike from the BOJ, with the expectation of clarifying its stance on narrowing the neutral rate range and future rate hike path,” ING Bank’s Min Joo Kang and Chris Turner wrote in a note. “However, both the BOJ and Ueda remained quite vague on this matter, which likely caused disappointment in the market.”Article contentIn commodities, oil headed for a second weekly decline as concerns over a growing glut outweighed potential supply disruptions. Brent has slipped more than 2% this week.Article contentCorporate Highlights:Article contentNike Inc. shares sank after the company warned that sales will decline this quarter amid persistent weakness in China and at its Converse brand.BBVA SA said it will carry out its largest share buyback ever as it seeks to draw a line under its failed bid for Banco Sabadell SA.TikTok’s long-delayed plan to separate from Chinese parent ByteDance Ltd. was put in motion Thursday when the video sharing sensation said it’s being bought by a group of buyers led by Oracle Corp.Gautam Adani’s conglomerate is in talks with a northern Indian state to build a commercial nuclear energy project, giving the billionaire a head start in a sector India is opening up to private firms, people aware of the development said.Article contentArticle contentSome of the main moves in markets:Article contentStocksArticle contentS&P 500 futures rose 0.2% as of 6:40 a.m. New York timeNasdaq 100 futures rose 0.3%Futures on the Dow Jones Industrial Average were little changedThe Stoxx Europe 600 was little changedThe MSCI World Index was little changedArticle contentCurrenciesArticle contentThe Bloomberg Dollar Spot Index rose 0.2%The euro fell 0.1% to $1.1710The British pound was little changed at $1.3370The Japanese yen fell 1.2% to 157.34 per dollarArticle contentCryptocurrenciesArticle contentBitcoin rose 3% to $88,189.96Ether rose 4.8% to $2,963.56Article contentBondsArticle contentThe yield on 10-year Treasuries advanced three basis points to 4.15%Germany’s 10-year yield advanced four basis points to 2.89%Britain’s 10-year yield advanced four basis points to 4.52%Article contentCommoditiesArticle contentWest Texas Intermediate crude rose 0.4% to $56.36 a barrelSpot gold fell 0.1% to $4,326.20 an ounceArticle contentThis story was produced with the assistance of Bloomberg Automation.Article content—With assistance from James Hirai and Levin Stamm.Article contentShare this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Tax Court overturns CRA decision to deny bitcoin loss writeoff Taxes Mortgage rates move — but in the wrong direction Mortgage Rates When sinking property values raise red flags for borrowers Mortgages Philip Cross: The sad story of Justin Trudeau’s 'youthful idiots' FP Comment Amid a wave of mortgage renewals, borrowers will have leverage in 2026 Mortgages