{"id":24731,"date":"2017-03-21T06:04:27","date_gmt":"2017-03-21T06:04:27","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=24731"},"modified":"2017-03-21T06:06:56","modified_gmt":"2017-03-21T06:06:56","slug":"asian-shares-15-month-high-dollar-soft-less-hawkish-fed","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/asian-shares-15-month-high-dollar-soft-less-hawkish-fed.html","title":{"rendered":"Asian shares at 15-month high, dollar soft on less hawkish Fed"},"content":{"rendered":"

\n\tAsian shares at 15-month high, dollar soft on less hawkish Fed<\/span><\/span><\/strong><\/span>
\n<\/h2>\n

\n\tAsian shares hit 15-month highs on Tuesday while the dollar and U.S. bond yields were on the back foot on the prospect of a less-hawkish Federal Reserve policy trajectory.<\/span><\/span><\/span>\n<\/p>\n

\n\tMSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.4 percent to 15-month highs, with tech-heavy Seoul and Taipei shares .KS11 .TWII hitting two-year highs while Hong Kong's Hang Seng .HSI scaled 1 1\/2-year highs.<\/span><\/span><\/span>\n<\/p>\n

\n\tJapan's Nikkei .N225 dropped 0.3 percent, weighed by financial stocks, which were hurt by lower U.S. yields and exporter stocks, which fell on the yen's gains against the dollar.<\/span><\/span><\/span>\n<\/p>\n

\n\tWhile Asian shares have been supported by signs of strong global economic growth, concerns about protectionism cast a shadow after financial leaders of the world's biggest economies dropped a pledge to keep global trade free and open, acquiescing to an increasingly protectionist United States.<\/span><\/span><\/span>\n<\/p>\n

\n\tWall Street shares drifted lower on Monday as investors worried that President Donald Trump's plan to cut taxes and boost the economy could take longer than earlier expected.<\/span><\/span><\/span>\n<\/p>\n

\n\t"Any fiscal spending by the Trump administration will not come until August at earliest and probably much later. So any economic benefit of that will show up only next year," said a senior trader at a European bank.<\/span><\/span><\/span>\n<\/p>\n

\n\t"So the markets are gradually pricing that in, winding back their initial rally after the elections."<\/span><\/span><\/span>\n<\/p>\n

\n\tAlthough Trump promised in early February to deliver a "phenomenal" tax plan within a few weeks, no such details have been released yet.<\/span><\/span><\/span>\n<\/p>\n

\n\t"U.S. stocks valuations are getting really expensive, so I expect the market to be capped for now. That also means Japanese shares are unlikely to gain further," said Tatsushi Maeno, senior strategist at Okasan Asset Management.<\/span><\/span><\/span>\n<\/p>\n

\n\tExpectations that the Federal Reserve will have to step up rate hikes to counter inflationary pressure from Trump's stimulus are also waning after the Fed dropped no hints of an acceleration in credit tightening last week.<\/span><\/span><\/span>\n<\/p>\n

\n\tChicago Federal Reserve President Charles Evans, in one of the first official comments after the Fed raised rates as expected last week, reiterated that message on Monday.<\/span><\/span><\/span>\n<\/p>\n

\n\tHe said that two more interest rate hikes this year were likely, disappointing investors who had anticipated rates to be increased more quickly. Evans's comments helped to bring down the 10-year U.S. Treasuries yield US10YT=RR to 2.461 percent, its lowest level in two weeks. It last stood at 2.479 percent.<\/span><\/span><\/span>\n<\/p>\n

\n\tLower yields undermined the greenback's allure, softening the dollar to three-week lows near 112.26 yen JPY= in early Asian trade.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe euro EUR= ticked up to $1.0758, near Friday's six-week high of $1.07825, maintaining its gains made last week after a election defeat for Dutch far-right leader Geert Wilders, which eased broader fears of a populist drift in European politics.<\/span><\/span><\/span>\n<\/p>\n

\n\tIn France, centrist Emmanuel Macron solidified his status as front-runner in the presidential election in a televised debate on Monday.<\/span><\/span><\/span>\n<\/p>\n

\n\t"At the moment, worries about the election have subsided a bit after the Dutch elections. But I expect the market to become more nervous near the election, given last year's experiences (with Brexit and the U.S. elections)," said Kazushige Kaida, head of foreign exchange at State Street.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe dollar's index against a basket of six major currencies .DXY =USD stood at 100.26, after hitting a six-week low of 100.02 on Monday.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe spectre of slower U.S. rate hikes has been helping high-yielding currencies.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe Australian dollar AUD=D4 traded at $0.7706, after hitting a 4-1\/2-month high of $0.7748 on Monday. It has risen 2.0 percent since the Fed's policy meeting last week.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe South African rand ZAR=D4 has gained 4.0 percent since then to a near 1-1\/2-year high while the Brazilian real rose 3.2 percent BRL=.<\/span><\/span><\/span>\n<\/p>\n

\n\tOil prices rose in Asia on expectations that an OPEC-led production cut to prop up the market could be extended.<\/span><\/span><\/span>\n<\/p>\n

\n\tPrices for front-month Brent crude futures LCOc1, the international benchmark for oil, gained 0.4 percent to $51.83 per barrel.<\/span><\/span><\/span>\n<\/p>\n

\n\tOPEC members increasingly favour extending the output curb beyond June to balance the market, sources within the group said, although they added that this would require non-OPEC members such as Russia to also step up their efforts.<\/span><\/span><\/span>\n<\/p>\n

\n\tSource:- http:\/\/www.reuters.com\/article\/us-global-markets-idUSKBN16S030<\/span><\/span><\/span><\/p>\n

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