Asian stocks and bonds are poised for gains, mirroring a rally on Wall Street, as a drop in oil prices has eased concerns about inflation and reignited investor appetite for riskier assets. Equity-index futures for Japan, South Korea, and Australia all indicate an upward trend at market open. US stock contracts showed minimal change after underlying benchmarks achieved their largest advance in six weeks, with the S&P 500 climbing 1.1% and the tech-heavy Nasdaq also seeing significant increases.
The current market sentiment is also influenced by the Federal Reserve's recent decision to hike interest rates for the first time in three years. Julian Emanuel, chief equity and quantitative strategist at Evercore ISI, suggests that investors should consider rebalancing their portfolios, shifting some assets from stocks to fixed income in response to this development.
Simultaneously, a substantial options expiry event is unfolding in the US, with approximately $7 trillion of US options notional value set to expire today. This event, known as 'triple witching,' involves the simultaneous expiry of monthly S&P 500 Index options and single stock options, making it the second-largest on record, according to data from Citadel Securities.
