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Asia markets retreat after strong week, eye on US data

Apr 28 2017 07:24

Hong Kong - Asian investors on Friday wound down after a strong week, with profit-taking weighing on most markets and attention turning to the release of US growth data later in the day.

Regional equities have seen a boon this week after France's moderate Emmanuel Macron won the country's presidential first round and looked set to beat his far-right rival in the run-off, while Donald Trump unveiled his long-awaited tax cut plans.

Upbeat earnings in the US have provided support, as did the Bank of Japan and European Central Bank reasserting their commitment to a loose monetary policy and Trump's decision not to scrap the NAFTA trade pact with Canada and Mexico.

However, there are concerns that Washington lawmakers have yet to pass a bill before Saturday that will prevent a costly shutdown of the US government, with Democrats and Republicans unable to agree even a short-term deal to give them more time.

"The Stop Gap bill appears stuck in the mud as the Republicans, despite controlling the majority in both House and Senate, are again and again relying on the Democrat vote as the Conservative hardliners are in constant opposition to even the most common sense spending proposal," said Stephen Innes, senior trader at OANDA, in a note.

In early trade Hong Kong was down 0.3% after a six-day rally, while Tokyo ended the morning session 0.2% lower.

Shanghai and Sydney each shed 0.3% while Seoul was marginally lower but Singapore, Wellington and Taipei edged higher.

Focus is now on Washington, where revised growth figures for the first three months of the year are due to be released on Friday.

The data will be pored over for clues about the Federal Reserve's interest rate plans, with bank officials saying they will make their decisions based on how the world's top economy is faring.

The Fed holds its next policy meeting on Wednesday.

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