Asian share off 1-1/2-year high, Trump's yuan comment in focus | Reuters
By Hideyuki Sano | TOKYO TOKYO Asian shares took a breather on Friday, hovering just below 1-1/2-year highs as investors braced for a potentially wobbly session after U.S. President Donald Trump called China 'grand champions' of currency manipulation.Over the past month or so, financial markets have been buffeted by rising protectionism under the Trump administration, and the President's latest comments on China does little to raise confidence on trade relations between the world's two biggest economies. His comments came just hours after his new Treasury secretary pledged a more methodical approach to analyzing Beijing's foreign exchange practices.The offshore yuan stood flat at 6.8476 per dollar CNH=D4.
By Hideyuki Sano
TOKYO Asian shares took a breather on Friday, hovering just below 1-1/2-year highs as investors braced for a potentially wobbly session after U.S. President Donald Trump called China "grand champions" of currency manipulation.Over the past month or so, financial markets have been buffeted by rising protectionism under the Trump administration, and the President's latest comments on China does little to raise confidence on trade relations between the world's two biggest economies. His comments came just hours after his new Treasury secretary pledged a more methodical approach to analyzing Beijing's foreign exchange practices.The offshore yuan stood flat at 6.8476 per dollar CNH=D4. In onshore trade, the yuan fell 6.6 percent last year in its biggest drop in over 20 years. All eyes are on the Chinese markets which open shortly.MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.1 percent in early trade after four straight days of gains while Japan's yen-sensitive Nikkei .N225 was off 0.7 percent.The MSCI world equity index .MIWD00000PUS, which tracks shares in 46 nations, rose 0.15 percent to 446.69 on Thursday, touching a record peak at 447.67 at one point and extending its gains so far this year to almost six percent.Leading the gains were emerging markets .MSCIEF, which have rallied more than 10 percent since the start of the year, thanks to signs of a pickup in global economic activity.
On Wall Street, the Dow .DJI managed to notch a record high for a tenth straight session, the longest streak since 1987. The streak of gains is the longest for the index since March 2013.Traders have bet on tax cuts, less regulation and more infrastructure spending from Trump and the Republican-controlled Congress to bolster the U.S. economy."There are strong expectations on tax cuts in the U.S. markets. On the other hand, the chance of a Fed rate hike in March seems limited, which is also helping shares," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.
U.S. Treasury Secretary Steven Mnuchin on Thursday laid out an ambitious schedule to enact tax relief for the middle class and businesses by August, but added the Trump administration was still studying a border tax.As Trump has promised a "phenomenal" plan by early March to cut business taxes, many investors expect more clarity when he delivers a speech to Congress on Tuesday.Wednesday's Federal Reserve minutes, which showed that there was less urgency among voting members to raise interest rates, have helped to drive down U.S. Treasuries yield and the dollar.The 10-year U.S. Treasuries yield hit a two-week low of 2.372 percent US10YT=RR.
The dollar slipped to 112.55 yen JPY=, also a two-week low, on Thursday and last stood at 112.69 yen.The euro fetched $1.0584 EUR=, off Wednesday's six-week low of $1.0494.Oil prices held firm near the top of their trading ranges, thanks to high compliance among the OPEC countries to curb output. U.S. crude futures CLc1 traded at $54.36 per barrel. (Editing by Shri Navaratnam)
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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.