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Stocks gain; dollar jumps vs yen after BOJ governor remarks

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2023-01-20T17:02:09Z

Global stock prices rose on Friday, with shares of Netflix boosting the S&P 500, while the dollar jumped against the Japanese yen as the Bank of Japan governor repeated the central bank will maintain its ultra-loose monetary policy.

A world stock index was still on track for a weekly loss, however, on mounting worries of a looming a global economic slowdown.

Netflix Inc (NFLX.O) was up nearly 7% in late-morning U.S. trading. The streaming video company said late Thursday it had picked up more subscribers than expected at the end of last year. Also, its co-founder Reed Hastings stepped down as chief executive.

BOJ Governor Haruhiko Kuroda, who addressed the World Economic Forum in Davos, Switzerland, said the central bank will maintain its “extremely accommodative” monetary policy to achieve its 2% inflation target in a stable, sustainable manner.

The Dow Jones Industrial Average (.DJI)
rose 170.56 points, or 0.52%,
to
33,215.12
. The S&P 500 (.SPX)
gained 34.39 points, or 0.88%,
to
3,933.24
and the Nasdaq Composite (.IXIC)
added 150.71 points, or 1.39%,
to
11,002.98
.

The pan-European STOXX 600 index (.STOXX)
rose 0.31
% and MSCI’s gauge of stocks across the globe (.MIWD00000PUS)
gained 0.80
%.

Europe’s STOXX 600 index has been recovering in 2023, driven by China reopening trades and easing natural gas prices.

The dollar was on track for its biggest daily gain against the yen in about two weeks after the BOJ governor’s remarks.

“There are some doubts within the BOJ whether the boost in inflation in Japan is going to deliver them all the way back to 2%,” said Thierry Wizman, global FX and rates strategist at Macquarie in New York.

The dollar rose as high as 130.60 yen and was last up 1.2% at 129.91. The greenback was set for its biggest percentage gain since early January.

At the same time, investors have worried that the U.S. Federal Reserve and the European Central Bank may be too aggressive in tightening monetary policy to battle inflation.

U.S. Treasury yields rose as investors wondered how much the Fed would keep raising rates. Also, investors bet that a recent bond rally may be overdone in the short-term.

Benchmark 10-year yields were last at 3.457%, a day after reaching 3.321%, the lowest since Sept. 13 and just above its 200-day moving average. The yields have fallen from 3.905% at year-end, and from a 15-year high of 4.338% on Oct. 21.

In energy, U.S. crude recently rose 0.06% to $80.38 per barrel and Brent was at $86.30, up 0.16% on the day.

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A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., November 11, 2022. REUTERS/Andrew Kelly/File Photo

Men walk past an electric board displaying Nikkei and other countries’ indexes outside a brokerage in Tokyo, Japan January 16, 2023. The characters on the screen reads,”government bonds”. REUTERS/Kim Kyung-Hoon
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