By Saikat Chatterjee
| HONG KONG
HONG KONG Asian stocks fell on Wednesday as a sharp pullback in Wall Street on doubts about Donald Trump's economic agenda prompted investors to rush to safe haven assets such as gold and government bonds.Both the S&P 500 .SPX and the Dow Jones Industrial Average .DJI lost more than one percent on Tuesday in frantic trading, their biggest one day slide since before Donald Trump's election victory in November. [.N]MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.5 percent in early trades after it hit its highest level since June 2015 in the previous session. Early Asian market openers such as Japan .N225 and Australia fell more than a percent.
"Nerves about implementation of the Trump agenda will remain the focus for markets with the Obamacare repeal vote in U.S. congress on Thursday," ANZ strategists wrote in a daily note.With valuations stretched -- U.S. stocks are trading at the upper end of their historical valuation ranges -- investors see the Trump administration's struggles to push through the healthcare overhaul as a sign he may also face setbacks delivering promised corporate tax cuts. Expectations of those tax cuts have been a major driver behind the 10-percent surge in the S&P 500 since Trump's election.
With investor mood decidedly risk-off, the Japanese yen scored some chunky gains against the U.S. dollar JPY=, rising to a four-month high. The greenback fell below a key level of 100 .DXY against a trade-weighted basket of its peers.Bonds gained with yields on two-year U.S. debt US2YT=RR falling to 1.27 percent in overnight trades, retreating further from a 7-1/2 year high of 1.38 percent hit last Wednesday when the U.S. Federal Reserve raised interest rates.
Gold XAU= was on track to extend its overnight strong performance with the precious commodity perched comfortably at a two-week high of $1,248 per ounce.Oil prices declined as concerns about new supply overshadowed the latest talk by OPEC that it was looking to extend output cuts. U.S. West Texas Intermediate crude CLc1 fell 1.8 percent to its lowest level since late-November to settle at $47.34 per barrel. Contracts were yet to be traded in Asia. (Reporting by Saikat Chatterjee; Editing by Sam Holmes)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Your guide to the latest election news, analysis, commentary, live updates and schedule for Lok Sabha Elections 2019 on firstpost.com/elections. Follow us on Twitter and Instagram or like our Facebook page for updates from all 543 constituencies for the upcoming general elections.
Updated Date: Mar 22, 2017 06:45:05 IST