Global banks extend rally while dollar fluctuates

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Bank stocks continued a rally sparked by the Trump administration’s plan to roll back financial regulations, while the dollar fluctuated as investors weighed the prospects for a Federal Reserve rate increase in March.
Equities from India to Japan climbed after the S&P 500 Index closed within a point of its all-time high. Mitsubishi UFJ Financial Group Inc. jumped to the highest level of the year to pace gains in bank stocks, and Chinese insurers in Hong Kong rallied. European stocks were little changed. The South Korean won extended the biggest weekly advance since July, while the Bloomberg Dollar Spot Index swung between gains and losses. Oil tested $54 a barrel after three straight weeks advancing.
Investors are considering the timing of the next U.S. interest-rate increase. Odds for a March move dropped after Friday’s jobs report showed weak wage growth even as hiring picked up, bolstering the Fed’s case for a gradual approach to tightening. Fed President John Williams reiterated that three rate hikes this year is a reasonable guess. The data capped a week that saw monetary policy makers in Japan, the U.K. and the US stand pat as they assess the impact of America’s new leadership on global growth.
Global financial shares are rallying for a second day after U.S. President Donald Trump moved to roll back bank regulations enacted to stop the next financial crisis. The group has soared 38 percent from a low a year ago. Banks in Japan are also benefiting from robust earnings, as surging global bond yields and market volatility since Trump’s election victory have been a boon to fixed-income trading.

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