Asian Stocks Mixed, Dollar Slips; Japan’s Topix index closed at the highest level since 1991 

Asian stocks were mixed as a rally that lifted regional equities to the highest levels in at least a decade stalled. The dollar came under pressure after advancing against G10 peers amid concern about the progress of U.S. tax reforms.

Japan’s Topix index closed at the highest level since 1991, while the Nikkei 225 Stock Average fell to end just below its strongest level since January 1992 reached on Tuesday. Stocks fluctuated in Hong Kong, where e-book publisher China Literature Ltd. jumped as much as 81 percent above its IPO price in its debut. S&P 500 Index futures declined. The dollar slipped after a Washington Post report that Senate Republican leaders are considering a delay in the implementation of a corporate-tax cut. Oil declined after recent rallies.

Geopolitics remain a focus as U.S. President Donald Trump continues his tour of Asia. Addressing South Korea’s National Assembly on Wednesday, he called on all nations to deny aid and assistance to North Korea as a way to choke off the rogue regime. He said he’s ready to offer North Korea “a path to a much better future” if it puts an end to its nuclear ambitions. The U.S. president aborted plans for a surprise visit to the demilitarized zone dividing South Korea and North Korea earlier due to heavy fog.

Next stop for Trump: Beijing. The U.S. president is expected to tackle issues such as North Korea and trade with his Chinese counterpart, Xi Jinping. Trump then attends the Asia-Pacific Economic Cooperation summit in Vietnam later this week, where he will be among 21 leaders including Xi and Russia’s Vladimir Putin. North Korea and Saudi Arabia are like to be among the dominant topics.

Equity indexes across the Persian Gulf were among the world’s worst performers Tuesday amid a widening crackdown on corruption in Saudi Arabia. The kingdom’s Tadawul All Share Index at one point fell the most in a year before regaining some of its losses.

China’s exports increased 6.9 percent in dollar terms in October from a year earlier, the customs administration said Wednesday.

Here are key events to watch out for this week:

• U.S. consumer sentiment probably cooled in early November from a more than 13-year high; the University of Michigan’s report is out on Friday.
• OPEC releases its World Oil Outlook.
• Thailand is expected to leave interest rates unchanged on Wednesday.
• Argentina’s central bank unexpectedly raised borrowing costs. Mexico, New Zealand and Malaysia are also holding monetary-policy meetings this week.
• The European Commission’s chief Brexit negotiator Michel Barnier and U.K. Brexit Secretary David Davis resume talks.
• Earnings season continues with announcements from Walt Disney Co., Adidas AG, and Siemens AG. European financial companies set to report include Banca Monte dei Paschi di Siena SpA,
• Credit Agricole SA, Allianz SE and Zurich Insurance Group AG.

And these are the main moves in markets:

Stocks

• The Nikkei 225 fell 0.1 percent at the close in Tokyo, after earlier dropping as much as 0.8 percent. The Topix rose 0.2 percent to the highest since November 1991. So far in the second-quarter earnings season, 61 percent of Topix-listed companies have posted profit that beat analyst estimates. Read more on why this rally has further to go here.
• The S&P/ASX 200 Index ended the session a notch firmer, consolidating at the highest since January 2008.
• South Korea’s Kospi index was little changed.
• Hong Kong’s Hang Seng Index swung between gains and losses and the Shanghai Composite Index was 0.3 percent higher.
• Futures on the S&P 500 fell 0.1 percent. The underlying gauge ended virtually unchanged Tuesday.
• The MSCI Asia Pacific Index was up 0.2 percent to the highest in about 10 years. The MSCI Emerging Markets Index hovered at the highest since mid-2011.

Currencies

• The Bloomberg Dollar Spot Index pared back some of Tuesday’s 0.3 percent gain, though remains close to the highest since July.
• The yen climbed 0.1 percent to 113.89, trading close to its weakest since March.
• The Aussie dollar was up slightly at 76.46 U.S. cents.
• The euro traded at $1.1591.

Bonds

• The yield on 10-year Treasuries was steady at 2.31 percent, the lowest in almost four weeks. Ten-year notes are headed for the longest winning streak since February 2016.
• Australian 10-year yields were at 2.57 percent. They fell to the lowest since June earlier this week.

Commodities

• West Texas Intermediate crude traded at $57.00 a barrel.
• Gold was steady at $1,277.58 an ounce.
• Copper was little changed at about $3.09 a pound, the lowest in about a month, after falling 2.2 percent on Tuesday when the Bloomberg Commodity Index dropped for the first time in seven days.

Source: Bloomberg – Asian Stocks Mixed as Dollar Slips on Tax News: Markets Wrap

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