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August 20, 2026 - 02:08
5 minutes
(Bloomberg) — Asian stocks rose as pressure from the bond market eased after the US Treasury unveiled plans to buy back longer-dated debt to curb borrowing costs. Treasuries held their gains, while the dollar steadied after falling to a three-month low.MSCI’s Asia Pacific equities gauge climbed 0.8%, led by shares in South Korea, which jumped over 2%. US equity-index futures also advanced in early Asian trading after the S&P 500 Index posted a modest gain Tuesday, even as chipmakers declined.SK Hynix Inc. shares over 5% in early trading after the South Korean memory-chip maker unveiled plans to buy back 40 trillion won ($29 billion) of shares and return more profits to investors.The moves in stocks came after a rally in 30-year Treasuries drove yields down 10 basis points to 5.18% during the New York session. That was spurred by the US Treasury announcing plans to boost buybacks of securities dated from the 10-year to the 30-year after a surge in yields to multi-decade highs. Bonds in Australia and Japan tracked the moves in Treasuries.Gold climbed to around $4,515 an ounce, after climbing to its highest level since early June in the prior session. Brent was steady at $91.60 a barrel, while Bitcoin rose to around $70,000 after President Donald Trump pressed Congress to pass a key crypto bill as the White House hosted industry executives.Global bonds had been jolted in recent days as investors demanded greater compensation for inflation risks and rising government debt, while tensions in the Middle East added to inflation pressures. The selloff was also fueled by corporate borrowing to fund the artificial-intelligence boom and waning demand from traditional buyers of long-dated debt.“There is no question that the Administration has become very concerned about the bond market once again and thus they are giving it another injection of steroids,” said Matt Maley, chief market strategist at Miller Tabak + Co. This is something that could “buoy risk assets over the near-term.”Long-dated government yields surged globally this week, with the US 30-year yield reaching its highest level since 2007. A 10-year Treasury auction last week drew the highest financing cost for that maturity since 2007, while a 30-year sale a day later cleared at the highest yield since 2001.While the Treasury didn’t indicate how the operations would be paid for, it typically relies on issuance of bills for its fluctuating funding needs. If officials are in effect replacing longer-dated debt with short-term securities, the maneuver amounts to a version of the Federal Reserve’s “Operation Twist.”“This administration needs a win, and maybe that comes in the form of artificially trying to keep long Treasury rates contained,” said Jack McIntyre, a portfolio manager at Brandywine Global Investment Management. “They have to try something. Sentiment around the long-end globally is about as bearish as I have seen in a very long time.”Meanwhile, in geopolitical developments, the US will begin what Trump said would be an unprecedented economic warfare operation against Iran, after faulting the country for failing to take its chance to make a deal with him.Investors are also parsing minutes from the Fed’s latest meeting, which showed several officials favored raising interest rates last month and many thought further tightening may be needed if inflation failed to cool.However, uncertainty hung over the meeting as participants’ inflation outlooks were clouded by the Iran war.“Most participants anticipated that inflation would step down over the rest of the year as the effects of tariffs and earlier energy price increases wane, but many participants noted the possibility that inflation might be more persistently elevated,” the minutes said.Corporate Highlights:A personalized vaccine developed by Moderna Inc. and Merck & Co. reduced the recurrence of melanoma in a large, late-stage trial, raising expectations for treating the deadliest form of skin cancer and showing the promise of the embattled mRNA technology. Moderna shares spiked by a record 177%, though the stock remains well short of its Covid-era highs. Merck climbed 13%. Marvell Technology Inc. has agreed to give Alphabet Inc.’s Google rights to buy as much as $12.2 billion of its shares in exchange for purchasing chips. Estée Lauder Cos.’s results beat estimates and ended a run of three straight declines in annual revenue, a sign the beauty conglomerate’s turnaround efforts are gaining momentum. Some of the main moves in markets:StocksS&P 500 futures rose 0.1% as of 9:05 a.m. Tokyo time Hang Seng futures rose 0.9% Japan’s Topix rose 0.6% Australia’s S&P/ASX 200 rose 0.5% Euro Stoxx 50 futures fell 0.3% CurrenciesThe Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1679 The Japanese yen was little changed at 158.21 per dollar The offshore yuan was little changed at 6.7291 per dollar The Australian dollar was little changed at $0.7126 CryptocurrenciesBitcoin rose 0.7% to $69,513.45 Ether rose 1.7% to $2,256.63 BondsThe yield on 10-year Treasuries was little changed at 4.64% Japan’s 10-year yield declined four basis points to 2.855% Australia’s 10-year yield declined three basis points to 5.03% CommoditiesWest Texas Intermediate crude was little changed Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.©2026 Bloomberg L.P.
