Morning bid: central bank mine, stocks roll

June 12 (Reuters) – A look at Asian markets today from Louis Krauskopf.

Asian markets will turn their attention to a series of central bank meetings after ending last week on a bright note.

An MSCI measure of global stock markets on Friday reached its highest point in 13 months. Wall Street was optimistic as the S&P 500 posted its fourth consecutive weekly gain and a 20% rally from its October low, meaning the benchmark has confirmed a bull market, as many investors define it.

Meanwhile, Japan’s Nikkei posted nine consecutive weekly gains. Even battered Chinese stocks managed to close higher on Friday, boosting the auto and technology sectors, even as disappointing inflation data weighed on investor sentiment.

Of course, a busy week can quickly change moods. Producer price data is expected in Japan. In India, inflation and industrial production reports are due on Monday.

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But investors will be largely inclined to run key central bank meetings later in the week. The Federal Reserve is expected to pause the cycle of rate hikes when it makes its policy decision on Wednesday – although Tuesday’s US consumer price inflation report could complicate those plans if it turns out to be heated.

A day after its US counterparts, the European Central Bank is expected to raise interest rates by another 25 basis points, as traders look for clues about next steps. On Friday, the Bank of Japan met where recently appointed BoJ Governor Kazuo Ueda indicated that ultra-easy policy will continue until wage gains and inflation are stable and sustainable.

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Before the central bank boom, the US dollar fell again after strengthening in May. In other asset price action, oil prices fell on Friday, posting a second straight weekly decline, as disappointing Chinese data added to doubts about demand growth.

Here are the key developments that could provide more direction to the markets on Monday:

– Product prices in Japan (May)

– CPI data for India (May)

– Industrial Production in India (April)

Written by Lewis Krauskopf Editing by Diane Kraft

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The opinions expressed are those of the author. They do not reflect the opinions of Reuters News, which is bound by the trust principles of integrity, independence, and freedom from bias.

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