Asia

Asian stocks hit their highest level in 18 months, with positive momentum lifting European shares which were helped by Societe Generale earnings. Yields fell on some of the euro zone's battered low-rated bonds as investors put aside the political risks that have dominated markets this week. After trading flat, S&P futures bounced as US traders walked boosted by a spike in the USDJPY, ahead of earnings reports from Coca-Cola, Reynolds American, CVS Health, Nvidia and Twitter.

In preparation for a possible conflict with the U.S., China has shown off its Dongfeng 16 (DF-16) medium-range ballistic missile during military drills. The Chinese Ministry of Defense released a video showing the Dongfeng in action at an unspecified forest setting during the Chinese Lunar New Year. The highly accurate ballistic missile system is nuclear capable, with a range long enough to threaten U.S. and Japanese bases in Asia. The DF-16 is said to be accurate to within a few meters of its target and has a range of over 600 miles.

By Vincent Cignarella is an FX strategist who writes for Bloomberg

The Japanese yen is becoming more and more of a proxy for the Trump trade. If that’s true, dollar bulls better keep bailing.

Since the beginning of the year, the yen has nearly halved its post-election losses and has broken several major resistance levels. This is a signal the currency has momentum. If the dollar drops another leg -- a trading term for a short-term trend - it could be a sign that the Trump-inspired rally is over.

In an unexpected announcement, India’s central bank left borrowing costs unchanged for a second straight meeting, shifting its policy stance to neutral from accommodative, effectively signaling an end to easing cycle. The RBI left the benchmark repurchase rate at a six-year low of 6.25 percent, on expectations of a 25 bps cut. Central bank authorities left rates unchanged at the last, December 7 meeting, while saying that the policy stance remains accommodative.

In a mostly quiet Wednesday session, Asian stocks rose overnight along with European bourses, which were led higher by miners after Rio Tinto posted higher profits for the first time in three years and a bigger-than-expected dividend, while India’s Sensex extended declines after the central bank unexpectedly left rates unchanged. US futures were little changed as oil continued to fall after API reported a huge inventory build in the last week.