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By Swati Pandey
SYDNEY (Reuters) - The U.S. dollar bounced to a two-week top on Monday and S&P futures jumped as traders marked the passage of a Senate tax bill over the weekend, a move that raises the risk of more aggressive rate hikes in the world's largest economy.
Pointing to a firm start for European shares, FTSE futures were up 0.7 percent.
Traders will be focusing their attention on a meeting scheduled for British Prime Minister Theresa May and EU Commission President Jean-Claude Juncker to work on a Brexit deal.
The euro slipped 0.15 percent, while the British pound was steady amid media reports that an agreement was near on the terms of the Brexit divorce.
Asian shares started the week with a whimper.
The greenback jumped 0.7 percent to as far as 112.98 yen, the highest since Nov. 17 on expectations of faster U.S. rate hikes as fiscal policy was set to be eased even while the U.S. economy was running at or near full employment.
A U.S. tax cut could also boost corporate profits and lead to a slew of share buy-backs. U.S. stock markets have already rallied for months on hopes that Washington would provide significant tax cuts for corporations.
Indeed, EMini S&P stock futures jumped 0.6 percent on Monday.
U.S. healthcare shares are also set to rally after drugstore chain operator CVS Health Corp said on Sunday it had agreed to acquire U.S. health insurer Aetna Inc for $69 billion.
China's SSE Composite slipped 0.2 percent, while Australian shares eased 0.1 percent and Japan's Nikkei fell 0.5 percent. Among gainers were Hong Kong's Hang Seng index and South Korea's KOSPI.
"If you do see a U.S. fiscal stimulus in 2018 all its likely to do is accelerate the need for further U.S. policy tightening which indirectly could be negative for emerging markets," said Chris Weston, Melbourne-based chief market strategist at IG.
Yields on two-year notes rose to 1.806 percent, while those on the 10-year bond climbed to 2.4026 percent.
The dollar index added 0.3 percent against major currencies.
The cryptocurrency was last trading around $11,375 on the Luxembourg-based Bitstamp exchange.
In commodity markets, U.S. crude was off 40 cents at $57.96. Brent crude slipped 31 cents to $63.42, drifting away from a near 2-1/2 year peak of $64.65 touched last month.
Spot gold was off 0.45 percent to $1,274.4 an ounce.
(Reporting by Swati Pandey; Editing by Eric Meijer and Richard Borsuk)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)