Asia stocks dip after rally, focus back on fundamentals
by Admin |
Asian stocks dipped on Tuesday as the markets took a breather after the previous day's rally, although tech-inspired Wall Street gains helped limit the losses, with investor focus moving away from trade concerns and back to benign economic fundamentals.
MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.1 percent after surging 1.4 percent the previous day.
Japan's Nikkei gained 0.2 percent and South Korea's KOSPI lost 0.3 percent.
Wall Street's three major indexes rose overnight, led by a rally in tech stocks, pushing the Nasdaq to a record closing high.
Friday's better-than-expected May US employment report has helped revive investor optimism for the world's biggest economy, shifting the focus away from recent trade tensions.
"Strong US data put fundamentals back in the spotlight, just as Italian political concerns were ebbing," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo.
Italy's anti-establishment parties formed a coalition government on Friday to end three months of deadlock and averting potentially destabilising snap elections.
"The next focal point is the upcoming FOMC (Federal Open Market Committee) meeting and whether the Fed shows any indication of accelerating the pace of its rate hikes following the strong employment report," said Ichikawa.
The Federal Reserve is scheduled to hold a two-day policy meeting starting on June 12.
With risk aversion ebbing in the broader markets, safe-haven government bonds were sold and their yields rose.