(Bloomberg) -- Stocks in Asia fell after Wall Street notched up its worst session of the year on lackluster US economic data. The dollar also declined against its peers, notably the euro.
A gauge of regional shares opened lower, pulling off the four-month closing high struck Friday, helped by earnings from Alibaba Group Holding Ltd. Shares in mainland China, Hong Kong and South Korea all posted declines while Japan was closed for a holiday Monday.
The drop echoed the downbeat mood in New York on Friday, as investors balanced signs of a cooling US economy against the prospect of the Federal Reserve showing no signs of rushing to trim interest rates. Data showed US inflation expectations rising to the highest level in almost three decades.
“Amid the prevailing market weakness, a key question will be whether there are opportunities to buy the dip, given that the broader trend still leans on the upside,” Junrong Yeap, market strategist at IG Asia, wrote in a note.
Treasury futures slipped on Monday. Cash Treasuries trading in Asia is closed due to the holiday in Japan.
A gauge of the dollar weakened during early Asian trading.
“Dollar enthusiasm has waned somewhat due to a plethora of factors including gyrations on tariff headlines (and postponed deadlines), modestly negative US economic surprises and declining equity market volatility,” Barclays Plc analysts led by Audrey Ong wrote. “While US equities remain around record highs, there are also growing questions about sustainability of US exceptionalism.”
The euro outperformed among Group of 10 currencies, up 0.5% against the dollar after Germany’s conservative leader Friedrich Merz said he’ll move quickly to form a new government following Sunday’s federal election victory.
In Asia, diagnostic kits and vaccine maker shares climbed as researchers in China said they discovered a new coronavirus in bats that enters cells using the same gateway as the virus that causes Covid-19.
Tariff Tensions
Chinese Vice Premier He Lifeng expressed “serious concern” over President Donald Trump’s 10% tariff hike on Chinese goods in a call with Treasury Secretary Scott Bessent, China Central Television reported Friday. For his part, Bessent also signaled concerns on a host of issues with China, including “economic imbalances,” the US Treasury said.
The Trump administration told Mexican officials that they should put their own duties on Chinese imports as part of their efforts to avoid tariffs threatened by the US president, according to people familiar with the matter.
Separately, Trump is directing the Committee on Foreign Investment in the United States to restrict Chinese spending on technology, energy and other strategic US sectors, his administration’s latest salvo against the world’s second-largest economy.
In corporate news, Berkshire Hathaway Inc. is looking to increase ownership in Japan’s five largest trading houses “over time,” Warren Buffett said in an annual letter to shareholders. Saipem SpA and Subsea7 SA agreed in principle to create an oil services company with a combined backlog of €43 billion and expected revenue of about €20 billion.
Key events this week:
Eurozone CPI, Monday
Israel rate decision, Monday
Singapore CPI, Monday
BOE Deputy Governors Clare Lombardelli and Dave Ramsden speak, Monday
Germany GDP, Tuesday
South Korea rate decision, Tuesday
Taiwan industrial production, Tuesday
US consumer confidence, Tuesday
ECB Governing Council member Joachim Nagel delivers Bundesbank’s annual report, Tuesday
Richmond Fed President Tom Barkin speaks, Tuesday
Taiwan GDP, Wednesday
Thailand rate decision, Wednesday
US new home sales, Wednesday
Nvidia earnings, Wednesday
G-20 finance ministers and central bank governors meet in Cape Town though Feb. 27, Wednesday
Atlanta Fed President Raphael Bostic speaks, Wednesday
Brazil unemployment, Thursday
Eurozone consumer confidence, Thursday
Mexico unemployment, trade balance, Thursday
Spain CPI, Thursday
US GDP, durable goods, initial jobless claims, Thursday
ECB publishes account of Jan. 29-30 policy meeting, Thursday
Canada GDP, Friday
Chile industrial production, unemployment, Friday
France CPI, GDP, Friday
Germany CPI, unemployment, Friday
India GDP, Friday
Japan Tokyo CPI, industrial production, retail sales, Friday
Sri Lanka CPI, trade, Friday
US PCE inflation, income and spending, Friday
Chicago Fed President Austan Goolsbee speaks, Friday
Some of the main moves in markets:
Stocks
S&P 500 futures rose 0.4% as of 10:26 a.m. Tokyo time
Nikkei 225 futures (OSE) fell 1.8%
Australia’s S&P/ASX 200 was little changed
Hong Kong’s Hang Seng was little changed
The Shanghai Composite fell 0.1%
Euro Stoxx 50 futures rose 0.3%
Currencies
The Bloomberg Dollar Spot Index fell 0.2%
The euro rose 0.5% to $1.0507
The Japanese yen rose 0.2% to 149.04 per dollar
The offshore yuan was little changed at 7.2487 per dollar
Cryptocurrencies
Bitcoin rose 0.4% to $96,184.23
Ether fell 0.5% to $2,794.34
Bonds
Australia’s 10-year yield declined seven basis points to 4.44%
Commodities
West Texas Intermediate crude fell 0.3% to $70.16 a barrel
Spot gold fell 0.4% to $2,923.13 an ounce
This story was produced with the assistance of Bloomberg Automation.
