Asia stocks, euro, dollar subdued as economic, political uncertainty hits | Reuters
By Nichola Saminather | SINGAPORE SINGAPORE Appetite for stocks and the euro ebbed on Tuesday as political and economic uncertainty sent investors sheltering in the Japanese yen and gold, while expectations China's foreign exchange reserves had fallen for a seventh month added to nervousness. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was little changed in early trade.
By Nichola Saminather
SINGAPORE Appetite for stocks and the euro ebbed on Tuesday as political and economic uncertainty sent investors sheltering in the Japanese yen and gold, while expectations China's foreign exchange reserves had fallen for a seventh month added to nervousness. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was little changed in early trade. Japan's Nikkei .N225 dropped 0.6 percent as a stronger yen depressed stocks. Investors expected China to say on Tuesday that its foreign exchange reserves fell for the seventh straight month by about $10.5 billion to $3 trillion in January.But some said reserves may have actually risen due to tighter controls on moving money out of the country, as well the impact of a weaker dollar. Nevertheless, as reserves remain at around $3 trillion, concerns linger over the speed at which China has depleted its resources to defend the currency.Overnight, both U.S. and European stocks dropped.
Wall Street dipped as much as 0.2 percent, led lower by the energy sector as oil prices fell, with investors still waiting for details of President Donald Trump's economic policies. "The longer Congress and the Trump administration dither on fiscal stimulus, the less likely in everyone's estimation that it will come to pass," said Aaron Kohli, an interest rate strategist at BMO Capital Markets in New York.In Europe, declines followed the presidential campaign launch of far-right National Front Leader Marine Le Pen on a platform pledging to flight globalization and take France out of the European Union. French stocks .FCHI lost 1 percent, and yields on 10-year French government bonds hit their highest level since September 2015.
"Despite the reaction in the French yields, polls show Le Pen would finish runner up by a wide margin to either Independent Emmanuel Macron or Republican Francois Fillion," James Woods, global investment analyst at Rivkin Securities in Sydney, wrote in a note. The euro EUR=EBS slipped 0.1 percent to $1.0738 early on Tuesday. On Monday, it touched a near one-week low before closing down 0.3 percent. The dollar was little changed at 111.765 yen JPY= on Tuesday, failing to recover any of its 0.9 percent loss from Monday, as investors took refuge in the safe-haven yen.
The dollar index .DXY, which tracks the greenback against a trade-weighted basket of its peers, fared better, holding on to an increase of almost 0.1 percent from Monday at 99.907. Oil prices inched higher early on Tuesday after posting their biggest one-day loss since Jan. 18 on Monday, reflecting worries that rising oil supply out of the United States would outweigh OPEC output curbs. U.S. crude CLc1 gained about 0.35 percent to $53.20, after falling 1.5 percent on Monday. Gold surrendered some of Monday's strong gains but hovered close to its three-month high hit on the day. Spot gold XAU= slipped 0.1 percent to $1,234.01 an ounce, after surging 1.3 percent on Monday. (Reporting by Nichola Saminather; Additional reporting by Sam Forgione; Editing by Eric Meijer)
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By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.