Bonds & Stocks
A rally that put stocks on the cusp of all-time highs faltered, with investors gearing up for inflation data and parsing mostly positive earnings news. Gold slid the most in four years as the dollar rose alongside bonds. Following the S&P 500’s biggest back-to-back advance since June, the gauge barely budged on Tuesday. Equity exposure among global macro hedge funds and long-only strategies remain at the highest level in more than a year, despite some de-risking this month due to concerns over credit quality and trade, Barclays Plc strategists say.
Economy
Federal Reserve Governor Christopher Waller says the agency will be more active in studying ways to embrace innovative advancements in payments.“The revolution transforming payments is demanding change everywhere,” Waller said in prepared remarks for the Fed’s payments innovation conference in Washington.“I am here to say that the Federal Reserve intends to be an active part of that revolution,” added Waller, underscoring that the agency must do its part to understand how to best converge these innovations and the traditional financial ecosystem.Waller also said he has asked the central bank’s staff to explore the idea of a “payment account.” He said one possible prototype for this would be a “skinny” master account, which would provide access to the Fed’s payment rails.
World
Sanae Takaichi won the parliamentary vote to become Japan’s prime minister on Tuesday, making her the first woman to clinch the nation’s top leadership job. She secured 237 votes in the more powerful lower house, bringing her four votes above the majority line needed to confirm her victory. Lawmakers who aren’t affiliated with any of the major parties including Tadashi Morishima appeared to have supported Takaichi’s bid for leadership. Shortly after that result, she proceeded to win a run-off vote in the upper house.Takaichi’s ascension to the premiership is a historic feat in a country that has ranked low in female political representation. With that achievement out of the way, she will now face a range of challenges that include persistent inflation, a tense security environment and simmering domestic political instability.