Asian stocks slip as U.S. tax doubts snap global winning streak

Asian shares slipped on Friday on uncertainty about U.S. tax reforms after Senate Republicans unveiled a plan that differed from the House of Representatives’ version in several key areas, including a delay in the timing of a corporate tax cut.

European shares are expected to be little changed, with spread-betters looking at an almost flat opening for Britain’s FTSE and Germany’s DAX. 

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.15 percent. Japan’s Nikkei lost 0.8 percent, slipping off Thursday’s 21-year high after an almost relentless 16-percent rally in the past two months. But the index had a ninth consecutive week of gains. 

MSCI’s all-country equity index posted its first daily loss in more than two weeks on Thursday, ending at 10 days its longest winning streak since 2003. 

On Wall Street, the S&P 500 lost 0.38 percent while the Nasdaq Composite dropped 0.58 percent on Thursday. 

U.S. Republican senators said they want to slash the corporate tax rate in 2019, later than the House’s proposed schedule of 2018, complicating a push for the biggest overhaul of U.S. tax law since the 1980s. 

The House was set to vote on its measure next week. But the Senate’s timetable was less clear, with a formal bill yet to be drafted in that chamber, where Republicans have a much smaller majority and a narrower path to approval for any legislation, let alone one as contentious as a tax package. 

“Things look fluid, including on when the tax cut deal will be reached,” said Hirokazu Kabeya, chief global strategist at Daiwa Securities.

Others said a correction in share markets was due after a strong rally worldwide though to some, fundamentally the prospects for solid global economic growth are expected to support stocks. 
The European Commission forecast the euro zone economy will grow at its fastest pace in a decade this year.