A man is reflected in an electronic stock board showing stock information at a securities exchange house in Shanghai, China. (Photographer: Qilai Shen/Bloomberg News)

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Fallout from Friday’s $400 million cryptocurrency hack, a big week ahead for tech stocks, and the frenzy for Chinese offshore equities builds. Here are some of the things people in markets are talking about.

Crypto Hack Fallout

Three days on from the world’s biggest-ever digital currency theft, the episode is still reverberating through cryptocurrency markets and policy circles around the world. Japanese cryptocurrency exchange Coincheck Inc. said it will use its own capital to reimburse customers who lost money in Friday’s $400 million hack, a move that helped Bitcoin and its ilk to recover from their selloff on Friday. However the episode has heightened calls for stricter cryptocurrency oversight and may influence a closely watched debate in neighboring South Korea over whether to ban digital-asset exchanges outright. Meanwhile, the Bank of Japan says it sees no need to mint its own digital currency, due to lack of Japanese demand

Kuroda at Davos

The yen strengthened as much as 1 percent against the dollar on Friday following comments by Bank of Japan Governor Haruhiko Kuroda at the World Economic Forum in Davos, but pared the gain after the central bank said the governor wasn’t revising the country’s inflation outlook. “Even medium- to long-term inflation expectations, which have been so weak in the last couple years, are now slightly picking up,” Kuroda, speaking in English, said on a panel. Later, a BOJ spokesman said Kuroda’s comment is not different from the central bank’s view stated on Jan. 23. U.S. President Donald Trump also spoke at Davos on Friday, arguing that his “America First” agenda would benefit the world. Trump is the first U.S. president to visit the conference in 18 years, and he made his government’s presence felt with a large delegation of Cabinet secretaries and top White House aides. 

Chinese Stock Euphoria

The growing frenzy for Chinese offshore stocks has taken a new turn as investors bid up underperformers. As a bull market in the China H-share gauge extends into the 714th day, one of the longest in its 23-year history, investors are finding plenty of reasons to buy and few to sell. About a third of the companies on the Hang Seng China Enterprises Index racked up fresh one-year highs last week, the biggest proportion since the country’s 2015 stock bubble. Laggards such as PetroChina Co. and China Galaxy Securities Co. have soared, while stubbornly cheap banks are turning red hot.

A Good Start for Equities

Asian equities are poised for a solid start to the trading week after U.S. stocks jumped the most since March on Friday on strong corporate earnings. The dollar slumped to a three-year low, losing most ground among G-10 currencies to the Aussie and Swiss franc. Oil continued its ascent, while metals were mixed, with iron ore lower. Bond yields are rising even after Friday's below-forecast 2.6 percent U.S. GDP report. This week, investors face Janet Yellen's swan song as Fed chair, U.S. jobs data and the Treasury's plan to cover widening deficits. Wall Street is anticipating an onslaught of supply that will at least double issuance this year to more than $1 trillion.

Coming Up…

Japan Inc. may be looking forward to some welcome distraction from yen strength as earnings reports start to flow this week. Microsoft, Facebook and PayPal release results Wednesday in the U.S., followed by Alibaba, Apple, Alphabet and Amazon a day later. In health care, Pfizer, Eli Lilly and Merck report. Boeing and UPS are also due. Deutsche Bank and oil majors Exxon Mobil and Chevron close out the week. Asia's data docket looks very light until Wednesday's month-end deluge. And on Tuesday night U.S. time, Trump delivers his State of the Union address, which is expected to include a push for massive infrastructure spending. 

What we’ve been reading

This is what caught our eye over the last 24 hours.

To contact the authors of this story: Alyssa McDonald in Sydney at amcdonald61@bloomberg.net, Garfield Clinton Reynolds in Sydney at greynolds1@bloomberg.net.

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