Easing hopes prop up global stocks, pound sags as Britain eyes new PM
TOKYO (Reuters) - Expectations of policy easing by major central banks such as the Federal Reserve propped up global stocks on Tuesday, while the pound sagged as Britain braced for a new prime minister who could pave the way for a no-deal exit from the European Union.
MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.02%.
Japan’s Nikkei rose 0.25%.
Australian stocks added 0.15% and South Korea’s KOSPI gained 0.2%.
The S&P 500 edged up toward a record high overnight, supported by expectations that the Federal Reserve would cut interest rates at its July 30-31 policy meeting.[.N]
European stocks had also nudged higher on Monday with the European Central Bank seen cutting rates by 10 basis points on Thursday.
But with central bank easing no longer a fresh theme, market gains were limited.
“The likelihood of easing by the Fed is supportive for equity markets, but the probability of a 25 basis point rate cut has already been factored in for the most part,” said Soichiro Monji, senior strategist at Sumitomo Mitsui DS Asset Management.
In currency markets, the pound was a touch lower at $1.2477 and headed for its third session of losses.
Sterling was under pressure due to the likelihood of eurosceptic Boris Johnson becoming Britain’s next prime minister.