Most Asian equities fell as traders await US and European central bank meetings this week for further clues on the 2018 policy outlook. The dollar was steady and oil extended gains above $58 a barrel.
The Nikkei 225 Stock Average retreated from a 26-year high, and Hong Kong and Chinese shares slipped, after US stock indexes hit fresh highs overnight. Most major American gauges advanced, led by more than 1 percent increases in media, telephone and technology-hardware shares. Investors shrugged off a non-fatal explosion in New York in what was called a terrorist attack. Volumes remain lackluster ahead of the year’s final Federal Reserve and European Central Bank meetings.
The focus at the conclusion of the Fed’s two-day meeting will be its outlook for next year, with investors debating the impact of coming policy normalization on global asset markets. Outgoing Chair Janet Yellen is expected to signal on Wednesday more interest-rate increases to come in 2018 after raising the Fed’s benchmark by a quarter of a percentage point.
The pound held around its lows of the month as optimism fades over the Brexit deal reached last week. Australia’s 10-year bond yields dropped after reports showed a drop in home prices and retreat in business confidence, eroding bets that interest rates will increase.
Here are some of the key events scheduled for this week:
Fed policy makers announce their decision on Wednesday. The ECB, Bank of England and Swiss National Bank set monetary policy at their respective meetings on Thursday. Among top U.S. economic reports are consumer inflation on Wednesday and retail sales on Thursday. European lawmakers continue to debate Brexit and weigh moves on the next step, while North America Free Trade Agreement negotiators meet again.
And these are the main moves in markets:
The Topix index rose 0.1 percent at the close of trading in Tokyo. The Nikkei 225 Stock Average fell 0.3 percent. The Kospi index fell 0.5 percent and Australia’s S&P/ASX 200 Index was up 0.3 percent. Hong Kong’s Hang Seng Index fell 0.2 percent. The Shanghai Composite Index lost 0.7 percent. Futures on the S&P 500 Index were up less than 0.1 percent. The main gauge rose 0.3 percent Monday to a record 2,659.99. The MSCI Asia Pacific Index dropped 0.1 percent.
The Bloomberg Dollar Spot Index was flat, holding at a three-week high. The yen rose 0.1 percent to 113.47 per dollar and traded in a narrow range. The Australian dollar rose 0.2 percent to 75.38 U.S. cents. The euro was steady at $1.1774. The pound traded at $1.3350, near the weakest in two weeks.
The yield on 10-year Treasuries held at 2.38 percent. Australia’s 10-year yield fell four basis points to 2.52 percent.
West Texas Intermediate crude rose 0.8 percent to $58.43 a barrel. One of the most important pipelines in the world was shut, helping send crude 1.1 percent higher on Monday. Brent crude jumped above $65 a barrel for the first time in 2 1/2 years. Gold rose 0.3 percent to $1,245.06 an ounce. – Bloomberg