Asia stocks hover below nine-month peak after Wall Street stalls

By Shinichi Saoshiro TOKYO (Reuters) - Asian stocks hovered below a nine-month peak on Tuesday after disappointing bank earnings dented Wall Street, though recent signs the global economy is likely to avoid a sharper downturn helped limit the losses. MSCI's broadest index of Asia-Pacific shares outside Japan stood little changed

Reuters April 16, 2019 07:05:09 IST
Asia stocks hover below nine-month peak after Wall Street stalls

Asia stocks hover below ninemonth peak after Wall Street stalls

By Shinichi Saoshiro

TOKYO (Reuters) - Asian stocks hovered below a nine-month peak on Tuesday after disappointing bank earnings dented Wall Street, though recent signs the global economy is likely to avoid a sharper downturn helped limit the losses.

MSCI's broadest index of Asia-Pacific shares outside Japan stood little changed.

The index had risen to its highest level since July 2018 the previous day after strong data from China eased investor concerns about the health of the global economy. Expectations that Chinese and U.S. trade negotiators would strike a deal soon also lifted confidence.

Japan's Nikkei nudged up 0.25 percent.

"The equity markets are facing some headwinds after their recent large gains," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

"That said, market sentiment is still relatively well supported as recent Chinese indicators proved to be strong and prompted the markets to readjust their views on the global economy."

The U.S.-China trade dispute, signs of slowing global corporate earnings and business investment have all put pressure on riskier assets in the past year, so investors have been quick to lap-up positive news.

Wall Street lost ground on Monday, dragged down as underwhelming bank earnings curbed investor enthusiasm. But while all three major U.S. stock indexes edged lower, the S&P 500 remained within a percent of its record high.

Safe havens such as bonds and gold were on the defensive following the recent improvement in investor risk appetite.

The 10-year U.S. Treasury yield rose to 2.574 percent on Monday, its highest since March 20.

Spot gold was a shade higher at $1,288.24 an ounce following three straight days of losses.

Elsewhere in commodities, the recent rally in crude oil prices slowed on the prospect of Russia and OPEC boosting production to fight for market share with the United States.

U.S. West Texas Intermediate crude futures were up 0.15 percent at $63.50 per barrel after losing nearly 0.8 percent the previous day.

U.S. crude had scaled a five-month high of $64.79 earlier this month.

Oil had rallied on tightening global supplies, as output has fallen in Iran and Venezuela amid signs the United States will further toughen sanctions on those two OPEC producers, and on the threat that renewed fighting could stop production in Libya.

The dollar, which tends to underperform when risk appetite increases, was a shade lower at 96.924 against a basket of six major currencies, extending overnight losses.

Many investors are waiting on Chinese gross domestic product (GDP) data due on Wednesday for clues on the health of Asia's giant economy, a major pressure point for global growth over the past year.

A Reuters poll forecast China's first-quarter growth to have cooled to the weakest pace in at least 27 years, but a flurry of measures to boost domestic demand may have put a floor under slowing activity in March.

The euro was flat at $1.1304 and the dollar was effectively unchanged at 111.98 yen.

The Australian dollar, a barometer of global risk appetite, was steady around $0.7176, not far off a seven-week high brushed on Friday.

(Editing by Shri Navaratnam)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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