Global Markets: Asian equities are likely to have a bumpy ride on Friday after US stocks scaled new peaks for a third straight day and bond yields surged on the Federal Reserve`s average-inflation strategy, as well as a promising development in curbing the coronavirus pandemic. Markets swirled after Fed Chairman Jerome Powell laid out a policy that aims for 2% inflation on average so that too low a pace would be followed by an effort to lift inflation "moderately above 2% for some time." As investors tried to digest its ramifications, gold rose, and then fell. Yields gained on longer-dated government bonds fell, and then rose.

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The dollar rebounded after an initial drop and gold prices flipped in choppy trade, retreating from early gains on Powell`s comments, which investors had widely expected.

"There seems to be a bit of rotation with regards to the news today and how the market has responded, giving the markets a value bump," said Matthew Keator, managing partner in the Keator Group, a wealth management firm in Lenox, Massachusetts.

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"The steepening of the yield curve is a welcome addition, particularly on a day when the market is rising," Keator added.

Australian S&P/ASX 200 futures lost 0.15% in early trading. Japan`s Nikkei 225 futures added 0.09%, while the Nikkei 225 index closed the overnight session down 0.35%Hong Kong`s Hang Seng index futures rose 0.05%.

On Wall Street, the Dow Jones Industrial Average rose 160.35 points, or 0.57%, to 28,492.27, the S&P 500 gained 5.82 points, or 0.17%, at 3,484.55, both setting new intraday highs.

The Nasdaq Composite dropped 39.72 points, or 0.34%, to 11,625.34.

MSCI`s gauge of stocks across the globe shed 0.14%.

Emerging market stocks lost 0.19%. MSCI`s broadest index of Asia-Pacific shares outside Japan closed 0.14% lower, while Japan`s Nikkei %.

Stocks also rose on news that Abbott Laboratories won U.S. marketing authorization for a COVID-19 portable antigen test that can deliver results in 15 minutes and will sell for $5. Abbott shares rose 7.9%.

But as negotiations between the Republicans and Democrats on another coronavirus aid package have stalled, some analysts worry this will eventually threaten the equity-market rally.

Crude oil declined 0.28% to $42.90 per barrel as Hurricane Laura, which initially made landfall in the heart of the U.S. oil industry and forced oil rigs and refineries to shut down, began to weaken.

The dollar index <=USD> rose 0.217%, with the euro down 0.03% to $1.1818 and spot gold prices dropped 0.1% to $1,927.81 an ounce.

The number of Americans filing new claims for unemployment benefits hovered around 1 million last week, while the U.S. economy suffered its sharpest contraction in at least 73 years in the second quarter, two government entities said.

The 10-year U.S. Treasury note rose to yield 0.7538% from 0.746%.