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Asia stocks follow US peers lower; bonds steady: Markets wrap
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Stock, bonds, oil and gold (Bloomberg/Graphic)
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sian stocks posted modest losses Friday following a weak US session as investors mulled an uncertain economic backdrop and mixed signals on trade negotiations. Treasury yields pared Thursday’s gains.
Shares in Japan, Hong Kong and Korea retreated and Australian equities edged higher after weaker than expected data from Europe and the US reignited worries about the world economy. US durable goods orders were below expectations and home sales missed estimates. The dollar held an overnight gain amid reports signaling uneven progress in US-China trade talks as next week’s deadline for more tariffs nears. The Aussie recouped some losses after the nation’s Treasurer said China had not banned its imports.
The weakness in equities comes after the MSCI’s global gauge of stocks surged 15 percent in less than two months on optimism over a US-China trade agreement. President Donald Trump plans to meet with China’s top trade negotiator Friday afternoon as the US tries to forge a preliminary deal with its biggest economic rival, two people familiar with the matter said.
Despite increasing confidence a deal can be done, investors shouldn’t expect the stellar run for risk assets to continue at this pace, said Richard Turnill, global chief investment strategist at BlackRock.
“Don’t chase the rally,” Turnill told Bloomberg TV. “Don’t extrapolate the double-digit gains we’ve seen in the first six weeks of this year.”
Also in focus on Friday is a speech from European Central Bank President Mario Draghi. Elsewhere, West Texas oil fell below $57 a barrel after an industry report showed American crude stockpiles continue to swell. (bbn)
