{"id":104377,"date":"2021-01-11T03:40:30","date_gmt":"2021-01-11T03:40:30","guid":{"rendered":"https:\/\/fin2me.com\/?p=104377"},"modified":"2021-01-11T03:40:30","modified_gmt":"2021-01-11T03:40:30","slug":"asia-stocks-off-highs-yields-up-on-looming-u-s-stimulus","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/asia-stocks-off-highs-yields-up-on-looming-u-s-stimulus\/","title":{"rendered":"Asia stocks off highs, yields up on looming U.S. stimulus"},"content":{"rendered":"
SYDNEY (Reuters) – Asian shares took a breather on Monday while Treasury yields were at 10-month highs as \u201ctrillions\u201d in new U.S. fiscal stimulus plans were set to be unveiled this week, stoking a global reflation trade.<\/p> Investors were keeping a wary eye on U.S. politics as pressure grew to impeach President Donald Trump, though signs were an actual trial could be some time away.<\/p>\n MSCI\u2019s broadest index of Asia-Pacific shares outside Japan dipped 0.2%, having surged 5% last week to record highs. Japan\u2019s Nikkei was on holiday after closing at a 30-year high on Friday.<\/p>\n South Korea went flat after an early jump, and Chinese blue chips firmed 0.7%.<\/p>\n \u201cAsia has come through the second global crisis this millennium with its credentials,\u201d said ANZ chief economist Richard Yetsenga.<\/p>\n \u201cAsia\u2019s growth is stronger, with for the most part better demographics and debt levels, than advanced economies.\u201d<\/p>\n He noted a turnaround in fortunes between the semiconductor and energy sectors highlighted Asia\u2019s success, given the region produced around 45% of the world\u2019s semiconductors.<\/p>\n \u201cFor the first time the global semiconductor sector\u2019s market capitalisation has surpassed energy,\u201d he said. \u201cAt the time of the last crisis, 12 years ago, the energy sector was more than five times larger.\u201d<\/p>\n Futures for the S&P 500 slipped 0.6% from all-time peaks, after gaining 1.8% last week. EUROSTOXX 50 futures eased 0.1% and FTSE futures were flat.<\/p>\n Longer-term Treasury yields were at their highest since March after Friday\u2019s weak jobs report only fanned speculation of more U.S. fiscal stimulus now that the Democrats have control of the government.<\/p>\n President-elect Joe Biden is due to announce plans for \u201ctrillions\u201d in new relief bills this week, much of which will be paid for by increased borrowing.<\/p>\n At the same time, the Federal Reserve is sounding content to put the onus on fiscal policy with Vice Chair Richard Clarida saying there would be no change soon to the $120 billion of debt the Fed is buying each month.<\/p>\n With the Fed reluctant to purchase more longer-dated bonds, 10-year Treasury yields jumped almost 20 basis points last week to 1.12%, the biggest weekly rise since June.<\/p>\n Treasury futures lost another 3 ticks early Monday.<\/p>\n Mark Cabana at BofA warned stimulus could further pressure the dollar and cause Fed tapering to begin later this year.<\/p>\n \u201cAn early Fed taper creates upside risks to our year-end 1.5% 10-year Treasury target and supports our longer-term expectations for neutral rates moving towards 3%,\u201d he said in a note to clients.<\/p>\n The poor payrolls report will heighten interest in U.S. data on inflation, retail sales and consumer sentiment.<\/p>\n Earnings will also be in focus as JP Morgan, Citigroup and Wells Fargo are among the first companies to release fourth-quarter results on Jan. 15.<\/p>\n The climb in yields in turn offered some support to the down-trodden dollar, which had edged up to 90.439 against a basket of currencies from last week\u2019s low of 89.206.<\/p>\n The euro pulled back to $1.2170 from a recent top of $1.2349, breaking support around $1.2190. The dollar also firmed to 104.18 yen from a trough of 102.57 hit last week.<\/p>\n The sudden lift in bond yields undermined gold, which pays no interest, and the metal fell back 1.1% to $1,828 an ounce from its recent peak of $1,959. [GOL\/]<\/p>\n Oil prices ran into profit taking after reaching their highest in nearly a year on Friday, gaining 8% on the week after Saudi Arabia pledged to cut output. [O\/R]<\/p>\n Brent crude futures dipped 48 cents to $55.51, while U.S. crude futures lost 28 cents to $51.96 a barrel.<\/p>\n