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Sydney - The global equities rally that pushed stocks to record highs eased in Asia as some investors cautioned that gains had gone too far. The dollar snapped a two-day advance as Treasury yields declined.
Indexes advanced in Tokyo and Sydney after US benchmarks closed at all-time highs on Tuesday along with the MSCI All-Country World Index. European equity-index futures inched lower. Apple suppliers in Asia dropped amid speculation traders were underwhelmed by the company’s new products.
New York-traded oil maintained gains as OPEC and its allies discuss an extension of output curbs. The pound extended its advance triggered by a bigger-than-forecast jump in inflation ahead of a central bank policy meeting.
Record stock prices are provoking concern in some corners of the market. The number of investors seeking protection from a possible plunge has surged and Leon Cooperman, the billionaire founder of hedge fund Omega Advisors, says a correction could start “very soon.”
A batch of Chinese economic indicators due on Thursday is expected to signal improving consumption and factory output along with some softening in investment, while US prices data could impact the timing of the next Federal Reserve interest-rate hike.
Meanwhile, geopolitical concerns keep waxing and waning. North Korea said it will accelerate its plans to acquire a nuclear weapon that can strike the US homeland in its first response to fresh United Nations sanctions.
Earlier, Treasury Secretary Steven Mnuchin warned the US may impose additional sanctions on China - potentially cutting off access to the US financial system - if it doesn’t follow through on the new UN restrictions.
Among the key events this week for markets:
• US retail sales and inflation data are due.
• The UK reports wage data on Wednesday.
• The Bank of England will almost certainly leave policy unchanged on Thursday.
• Also scheduled this week is data on China’s August industrial production, retail sales and fixed-asset investment.
• Australia releases jobs numbers on Thursday.
Here are the main moves in markets:
Stocks
• The Topix index rose 0.6% at the close in Tokyo.
• Australia’s S&P/ASX 200 Index was little changed and the Kospi index in Seoul finished the session 0.2% lower.
• Hong Kong’s Hang Seng Index fell 0.3%, while the Shanghai Composite Index fluctuated.
• Among Apple suppliers, Hon Hai Precision Industry and Pegatron fell, weighing on the Taiex index, which was down 0.7%.
• AAC Technologies in Hong Kong also declined.
• Apple slid along with some of its biggest suppliers on Tuesday.
• Futures on the Euro Stoxx 50 fell 0.1% as of 08:32.
• Contracts on the S&P 500 were down 0.1%.
• The underlying gauge climbed 0.3% on Tuesday in New York.
• The MSCI Asia Pacific Index added 0.1%.
Currencies
• The Bloomberg Dollar Spot Index fell 0.1% after rising for the previous two days.
• The yen was little changed at 110.11 after sliding 0.7% on Tuesday.
• The euro traded at $1.1982, up 0.1%.
• The pound climbed 0.1% to $1.3301.
• The Australian dollar rose 0.2% to 80.34 US cents and the New Zealand dollar traded at 72.99c.
Bonds
• The yield on 10-year Treasuries was 2.16%, down one basis point after increasing four basis points on Tuesday.
• Australian 10-year bond yields rose about three basis points to 2.67%.
• The yield on 10-year German bunds was steady at 0.40%.
Commodities
• West Texas Intermediate crude was little changed at $48.23 a barrel.
• The Organisation of Petroleum Exporting Countries and its allies are discussing extending by more than three months the oil production cuts that expire in March 2018.
• Gold was steady at $1 330.64 an ounce.
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