Global shares under the cloud of technology, no lift of Japan's accommodative policy promise

LONDON (Reuters) – The Bank of Japan confirms that it will maintain its very accommodative monetary policies for a long time, which has lowered the yen and global bond rates Tuesday, although more and more Stock concerns under pressure.

A A recent Reuters report that the Bank of Japan could debate the curtailment of its massive stimulus program drove Japanese bond yields to 1-1 / 2 highs, bursting into emerging markets. debt and the euro area. This helped push the yen to more than 2 percent of the six-month low against the dollar in early July.

But while the BOJ has announced some adjustments to its stock purchase program and said its stimulus package would be more flexible, the changes have shown no trend for changes radicals compared to its accommodative position.

In response, Japanese 10-year bonds <JP10YT = RR fell 3 basis points, and 40-year yields fell by almost 9 points, pushing US and German 10-year yields to 2- 3 pb.

"The BOJ is important in the sense of what it did not do," said Andrew Milligan, head of global strategy at Aberdeen Standard Investments in Edinburgh.

"It was disappointing for some investors who thought that they would be more hawkish in their approach and the market reaction, with yields in yen and lower bonds, shows that this view that many people held, is wrong. "

later, they made little progress in stabilizing after the data showed higher-than-expected inflation, albeit fueled by higher energy costs. Separate data revealed that block economic growth was slower than expected in the second quarter of 2018.

The yen fell 0.4% to trade around 111.2 yen for a dollar . Many analysts now estimate that it is stabilizing around 113, especially if the US Federal Reserve delivers a fierce interest rate message when its policy meeting ends Wednesday.

(For a graph on the Yen, bond yields fall after the promise of the BOJ "click on reut.rs/2KethlI)

The dollar was flat against a basket of currencies, but seems to trigger a series Three-month gains as markets more or less valued in two more Fed rate hikes this year. The greenback had risen more than 5% in the second quarter of 2018.

However, the conciliatory promise of the BOJ has failed to stimulate equities. Markets were disrupted by growing concerns over the global technology sector that seemed relatively insensitive to trade tensions between the US, Europe and China.

The meager Netflix and Facebook revenues caused losses in the tech sector, with Wall Street's tech index falling 6% in the last three sessions.

(For a graph on "FAANGs biting?" Click reut.rs/2KeglfE)

This pushed global stocks to lows of a week and even the Japanese Nikkei did not. failed to maintain the BOJ's previous earnings. The MSCI Asia-Pacific tech stocks index fell nearly 1%.

European technology followed suit, losing 0.6% and lagging behind the broader equities that stagnated during the day.

Wall Street has been set for a slightly firmer opening, futures expected that investors expect second-quarter profits from the largest company, the iPhone manufacturer Apple.

But the downturn in technology has eclipsed an otherwise dynamic US earnings season, with average earnings growth of 22.6% and 83% of companies beating consensus estimates so far.

Milligan attributed the failure to a revaluation of stock prices and profit taking in the summer rather than a fundamental loss of confidence in the sector. World stocks are expected to end in July with the best monthly returns since January, he noted.

World values ​​are set for the best month since Jan reut.rs/2K7PvFV

"The market says" you are rightly valued around these prices so let's wait for the next big story. "It will either be down with trade tensions in the fall or it could be positive if China's stimulus measures prove larger than expected, "added Milligan.

He was referring to the Beijing ads, offering more tax incentives to counter the effect of US tariffs and encouraging banks to lend to small businesses.

Markets are now waiting for Wednesday's Fed statement to see if the two expected rate hikes for the remainder of 2018 can be consolidated. In Britain, a rise of 25 basis points is now widely expected Thursday, despite the impending economic weakness of the European Union.

David Riley, chief investment strategist at BlueBay Asset Management, said the sterling was already proven, adding, "I think they'll do it, but it'll be one."

The pound is firmer. percent at about $ 1.3159, after drifting from the 10-month lows of $ 1.2955 touched earlier in July.