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Asia stocks rally stalls as Wall St. loses steam, dollar sags

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Syndicated News
Written by Syndicated News

TOKYO, March 13 2018 : Asian stocks stalled today as Wall Street shares lost steam, while the dollar sagged on the back of declining U.S. yields.

Investors were focused on U.S. inflation data due later in the day (1230 GMT) for clues on the pace of Federal Reserve interest rate rises this year.

MSCI’s broadest index of Asia-Pacific shares outside Japan was little changed by mid-morning.

The index had surged 1.5 percent yesterday following firm U.S. jobs numbers on Friday, while low wage growth eased concerns about inflation and faster central bank rate hikes.

But a mixed performance by U.S. shares overnight cooled investor risk appetite in Asia.

The S&P 500 .SPX and the Dow .DJI slipped yesterday as the U.S. tariffs signed into law last week weighed on industrials, while gains in tech stocks boosted the Nasdaq .IXIC to a new record high.

Japan’s Nikkei .N225 shed 0.2 percent, with shares in steelmakers and automakers still battered by concerns about U.S. tariffs on imported steel and aluminium.

Some market participants say a political scandal engulfing Japanese Prime Minister Shinzo Abe’s government is raising doubts about his ability to pursue economic reform, undermining stock market sentiment.

Australian shares lost 0.7 percent , while Shanghai dipped 0.1 percent .SSEC.

South Korea’s KOSPI .KS11 was effectively flat, faring better as major tech shares such as SK Hynix (000660.KS) and Samsung Electronics (005930.KS) rose following gains by their U.S. peers.

“Concerns towards trade conflict stemming from U.S. tariffs continue to linger in the background, capping risk appetite, pushing Treasury yields lower which in turn weighing on the dollar,” said Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo.

“That said, there are still bright spots that bode well for broader risk sentiment, as the Nasdaq’s gains shows.”

Separately, U.S. President Donald Trump yesterday blocked Singapore-based semiconductor maker Broadcom Ltd’s (AVGO.O) takeover bid of Qualcomm Inc (QCOM.O) on grounds of national security, ending what would have been the technology industry’s biggest deal ever.

The dollar index against a basket of six major currencies was flat at 89.891 after shedding about 0.2 percent overnight.

The euro was a shade higher at $1.2337 EUR=, adding to overnight gains of 0.25 percent.

The U.S. currency was down 0.05 percent at 106.350 yen JPY= as the renewed political scandal in Japan pushed it off last week’s peak above 107.00.

The benchmark 10-year U.S. Treasury note yield stood little changed at 2.877 percent. The yield declined by 2.5 basis points overnight.

In commodities, crude oil prices extended losses after sliding the previous day amid ongoing concerns over rising U.S. output.

U.S. crude futures lost 0.3 percent to $61.19 per barrel after losing 0.8 percent the previous day. Brent fell 0.3 percent to $64.76 per barrel. – Reuters
 

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Syndicated News

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