Nikkei suffers biggest fall in two months with return of trade worries

Japan’s Nikkei share average suffered its biggest fall in two months on Wednesday, as comments from U.S. President Donald Trump rekindled worries about trade friction, hurting steelmakers and shippers among others.

The Nikkei tumbled 1.2 percent to 22,690, after sliding to 22,650 earlier, the weakest intraday level since May 11.

Trump on Tuesday said he was not pleased with recent trade talks between the United States and China, checking hopes that the world’s two biggest economies were on course to hammer out a deal.

U.S. Treasury Secretary Steven Mnuchin has earlier said that trade war is “on hold”, sending the

Nikkei over the psychologically important 23,000 level on Monday.

Trump’s latest remarks followed Beijing’s announcement that it would cut import tariffs for automobiles and car parts.

Shippers were under pressure, with Mitsui OSK Lines and Kawasaki Kisen dropping 2.8 percent and 2.9 percent, respectively.

Steelmakers fell 1.4 percent, with JFE Holdings shedding 3.5 percent.

The broader Topix skidded 0.7 percent to 1,797, with small shares outperforming large cap shares.

Topix Small eased 0.1 percent, compared to a 0.9 percent fall in Topix Core 30. So far this week, the

Topix Small is down 0.2 percent whereas the top 30 firms are down 1.4 percent.

Tumbling banks hold back S&P 500 as earnings season launches

The S&P 500 fell 7.69 points, or 0.3 per cent, to 2656.30. The loss pared the index's gain for the week to 2 per cent. The Dow Jones industrial average dropped 122.91, or 0.5 per cent, to 24,360.14, and the Nasdaq composite lost 33.60, or 0.5 per cent, to 7106.65.

As a group, financial stocks in the S&P 500 fell 1.6 per cent, more than double the loss for any of the other 10 sectors that make up the index.

In the commodities market, gold rose $US6 to settle at $US1347.90 per ounce, silver added 19 cents to $US16.66 per ounce and copper rose a penny to $US3.07 per pound.

Natural gas rose 5 cents to $US2.74 per 1000 cubic feet, heating oil gained 2 cents to $US2.10 per gallon and wholesale gasoline added 1 cent to $US2.07 per gallon.

The yield on the 10-year Treasury note slipped to 2.82 per cent from 2.84 per cent late Thursday.

The dollar rose to 107.41 Japanese yen from 107.23 yen late Thursday. The euro rose to $US1.2334 from $US1.2329, and the British pound rose to $US1.4237 from $US1.4225.

In European stock markets, France's CAC 40 edged up 0.1 per cent, and Germany's DAX gained 0.2 per cent. The FTSE 100 in London rose 0.1 per cent.

Japan's Nikkei 225 rose 0.5 per cent, South Korea's Kospi advanced 0.5 per cent and Hong Kong's Hang Seng index edged down 0.1 per cent.

Asian stocks slide, as the dollar hits six-week high

Asian Stock Markets

Asian stocks were mostly lower on Thursday after Wall Street marked its worst monthly performance in two years as hawkish-sounding comments from new Federal Reserve Chair Jerome Powell reverberated across the broader risk asset markets. 

Spreadbetters expected European stocks to open lower, with Britain’s FTSE falling 0.7 percent, Germany’s DAX slipping 0.8 percent and France’s CAC retreating 0.75 percent.

Investors have been on edge in recent weeks amid concerns that rising interest rates in advanced economies, led by the United States, could sap global growth. 

Powell, in his first public appearance as head of the Fed, vowed at a congressional hearing on Tuesday (U.S. time) to prevent the economy from overheating while sticking with a plan to gradually raise interest rates. 

Those comments rekindled speculation in equity markets over U.S. monetary tightening this year happening faster than expected, feeding concerns that higher borrowing costs could crimp corporate activity and cool economic growth. 

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.5 percent and headed for its third day of losses. 

Chinese shares bucked the trend and edged up after a private survey showed growth in China’s manufacturing sector picking up to a six-month high. Shanghai shares were 0.15 percent higher. 

Australian stocks fell 0.7 percent, South Korea’s KOSPI shed 1.2 percent and Japan’s Nikkei dropped 1.55 percent. 

The losses in Asia came amid a broad selloff on Wall Street, where the Dow and S&P 500 capped their worst months since January 2016 overnight after suffering sharp losses early in February. 

The Dow scaled an all-time high late in January, before falling about 12 percent from that peak at the start of February as a rise in U.S. yields to multi-year highs unnerved Wall Street. 

It went on to recover a bulk of those losses, but the rebound stalled in the wake of Powell’s comments. 

The Fed’s last round of economic projections in December pointed to three rate increases this year, but Powell’s remarks prompted investors to wager on four rate rises instead.

DOLLAR COMEBACK CONTINUES

The dollar, which retreated to three-year lows last month, has taken heart from the Fed chair’s comments. 

The dollar index against a basket of six major currencies rose to 90.744, its highest since Jan. 19 and last stood at 90.703. 

The index has managed to claw back from the three-year trough of 88.253 set in mid-February when fears of a ballooning U.S. budget deficit and lingering worries that Washington could pursue a weak dollar policy took a toll. 

U.S. crude oil futures stood little changed at $61.65 per barrel after sliding more than 2 percent overnight. Brent crude lost 0.1 percent to $64.66 per barrel. 

A stronger greenback tends to weigh on commodities including crude as it makes them more expensive for non-U.S. buyers of dollar-denominated products. 

The euro was steady at $1.2192 and in close reach of a 1-1/2-month low of $1.2188 plumbed the previous day. 

The common currency came under pressure after data on Wednesday showed euro zone inflation slowing to a 14-month low and underscored the European Central Bank’s caution over removing its monetary stimulus. 

The dollar was little changed at 106.750 yen , having slipped from the week’s peak of 107.680 as broader risk aversion favoured its Japanese peer. 

The Australian dollar was down 0.45 percent at $0.7728 after brushing $0.7717 , its lowest since late December. 

Long-term U.S. Treasury yields stood little changed at 2.864 percent after declining about 3 basis points overnight on month-end purchases by investors rebalancing their portfolios and weaker Wall Street shares.

Asian stocks try a tentative bounce

Asian Stock Markets

Asian share markets found a semblance of calm on Monday as S&P futures extended their bounce, though global investors were still fretting about the risks from looming U.S. inflation data after last week’s sharp sell-off. 

MSCI’s broadest index of Asia-Pacific shares outside Japan crept up 1 percent, having suffered a 7.3 percent drubbing last week.

Both South Korea and China gained 1.2 percent, while Japan’s Nikkei was closed for a holiday.

E-Mini futures for the S&P 500 rose 0.6 percent, adding to a late bounce on Friday.

European bourses were expected to open with solid gains, with futures for the London FTSE already up 1.4 percent.

Yet a relatively sharp 14-tick drop in Treasury bond futures suggested it was too early to sound an all-clear on volatility.

Particularly challenging will be U.S. consumer price data on Wednesday given that it was fears of faster inflation, and thus more aggressive rate rises, that triggered the global rout in the first place.

Median forecasts are for consumer price inflation to slow a little to 1.9 percent in January from a year earlier, mainly due to the base effect of a high reading in January 2017, while the core measure is seen ticking down to 1.7 percent.

A result in line with or below expectations would likely be a big relief, while anything higher could well spook investors, lift bond yields and batter stocks.

Aziz Sunderji, an economist at Barclays, suspects the inflation scare will prove to be transitory.

THE RETURN OF VOLATILITY:

But what a bump it was.

The benchmark S&P 500 fell 5.2 percent last week, its biggest decline since January 2016.

Ninety-six S&P 500 stocks were down 20 percent or more from their one-year highs, according to Thomson Reuters data.

In Asia, Hong Kong’s high-flying shares shed almost 10 percent for the week, while Japan lost 8.1 percent and South Korea 6.4 percent.

The pivotal gauge of S&P 500 volatility, the VIX, remained relatively elevated at 29 percent.

Yields on U.S. 10-year Treasury paper touched a four-year top of 2.885 percent, moving ever further above the S&P 500’s dividend yield of 2.34 percent.

The ascent of yields had offered some support to the U.S. dollar last week, but was proving of limited help on Monday as speculators returned to short the currency.

The euro clawed back 0.5 percent to $1.2288, after losing 1.8 percent last week, while the dollar eased 0.4 percent on a basket of currencies to stand at 90.118.

The dollar was steady on the yen at 108.71, aided in part by reports that Haruhiko Kuroda would be re-appointed as head of the Bank of Japan and likely continue the country’s ultra-loose monetary policy.

Commodities pared recent losses, with gold 0.6 percent firmer at $1,323.88 an ounce and off a five-week low of $1,306.81.

Brent crude futures rallied 59 cents to $63.38 a barrel, while U.S. crude for April added 68 cents to $59.88.

Brent lost nearly 9 percent last week and U.S. crude dropped 10 percent, the steepest falls since January 2016.

JGBs tick up after Trump's dollar comments buoy U.S. Treasuries

Asian Stock Markets

Japanese government bond prices firmed on Friday, tracking gains in U.S. bonds following a strong 7-year note auction and comments from U.S. President Donald Trump that he wanted a strong dollar. 

The 10-year JGB futures price rose 0.08 point to 150.42 , and marked the first weekly gain in nine.
The market has been pressured by a rise in global bond yields on the back of solid economic growth and reduction in the Bank of Japan’s buying in long-dated bonds early this month.

Still, the cumulative losses during the past eight weeks were relatively small, because of the BOJ’s policy to peg the 10-year yield around zero percent.

The 10-year cash JGB yield dipped 0.5 basis point to 0.075 percent. The 20-year yield dipped 1.0 basis point to 0.580 percent, while the 30-year yield dropped 1.0 basis point to 0.810 percent.
JGBs gained as U.S. Treasuries bounced back after Trump’s dollar comments, which contradicted with remarks by Treasury Secretary Steven Mnuchin a day earlier.

The market showed no reaction to Japan’s inflation data, which showed consumer prices rose 0.9 percent in December as expected.

Nikkei drops after strong yen hurts exporters, mining firms soar

Japan’s Nikkei share average dropped to a 10-day low on Thursday morning as a stronger yen hurt exporters, although oil and mining stocks bucked the weakness, supported by firmer oil prices. 

The Nikkei fell 0.8 percent to 23,754.10 in midmorning trade after hitting as low as 23,688.94 earlier, the lowest since Jan. 15. The index is below its 5-day moving average of 23,888.85.

The dollar dropped 1 percent to a four-month trough of 108.965 yen before recovering to trade at 109.300 during Asian trade.

Transport equipment stocks tumbled, with Honda Motor Co sliding 1.2 percent, Subaru Corp falling 1.4 percent, while electronic appliance maker Panasonic Corp shed 1.2 percent and chip-making equipment manufacturer Advantest Corp stumbled 3.5 percent.

Banks also lost ground, with Mitsubishi UFJ Financial Group and Mizuho Financial Group both falling 1.0 percent.

Oil and mining stocks outperformed after oil prices hit their highest since December 2014, pushed up after U.S. crude inventories posted a 10th straight week of declines and as the dollar continued to weaken.

Inpex Corp added 0.3 percent, Japan Petroleum Exploration Co gained 1.6 percent, while Showa Shell Sekiyu advanced 1.1 percent.

The broader Topix declined 0.6 percent to 1,889.07.

Nikkei hits fresh 26-year high; BOJ trims bond buying

Asian Stock Markets

Asian shares edged higher on Tuesday, approaching record highs, while the yen stole the currency spotlight and jumped after the Bank of Japan’s slight reduction to its bond purchases reminded investors that it will eventually normalise policy. 

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.2 percent at 590.89, not far from its record peak of 591.50 scaled in November 2007.

On Wall Street on Monday, the Dow Jones Industrial Average .DJI edged down 0.05 percent, the S&P 500 .SPX gained 0.17 percent, and the Nasdaq Composite .IXIC added 0.29 percent. After the best start to a year in more than a decade, investors turned cautious ahead of earnings.

South Korea's share market .KS11 added 0.2 percent, with gains capped after Samsung Electronics Co's (005930.KS) guidance fell short of market expectations despite a forecast for a record fourth-quarter profit, as a strong won and one-off staff bonuses took the shine off surging DRAM chip prices. Samsung's shares slumped 1.9 percent.

The MSCI tech index for Asia .MIAS0IT00PUS was flat, after gaining more than 5 percent this year.
Japan's Nikkei stock index .N225 added 0.5 percent, paring its gains after the yen surged. It earlier touched its highest levels since November 1991, catching up to the previous session's gains as markets reopened after a holiday on Monday.

Against the yen, the dollar erased its early modest gains and fell 0.4 percent to 112.63 JPY= following a drop as low as 112.50, after Japan's central bank trimmed its purchases of Japanese government bonds (JGBs).

Since it adopted the yield curve control policy in 2016, the BOJ has made similar tweaks to its JGB purchases, which are regarded as mainly technical moves. On Tuesday, it cut its JGB purchases of 10 to 25 years left to maturity and those of 25 to 40 years to maturity by 10 billion yen ($88.39 million) each, from its previous operations for those zones.

While the central bank’s operational adjustments do not usually have an impact on foreign exchange markets, dealers said the timing of the move suggested some players had used it as an excuse to sell the dollar and the euro against the yen.


The euro was steady at $1.1969 EUR=, shy of its nearly four-month high of $1.2089 set on Thursday. Against the yen, it skidded 0.3 percent to 134.85 EURJPY= The dollar index, which tracks the greenback against a basket of six major rival currencies, edged down 0.1 percent to 92.269 .DXY.

Underpinning the dollar, investors bet on further U.S. interest rate hikes after Friday’s payrolls data did nothing to challenge the outlook for monetary policy tightening by the U.S. Federal Reserve. While job growth slowed more than expected, a pick-up in monthly wages pointed to labour market strength.

But the dollar’s upward momentum was tempered as investors differed on the pace of tightening while U.S. inflation remains relatively cool.

U.S. crude CLc1 rose 49 cents, or 0.8 percent, to $62.22 a barrel, while Brent crude LCOc1 added 44 cents, or 0.7 percent, to $68.22.

Spot gold XAU= was down 0.2 percent at $1,318.11 an ounce, pulling back from a 3-1/2-month high hit last week. [GOL/]

Nikkei rises, led by banks, financials; shrugs off North Korean missile launch

Asian Stock Markets

 Japanese stocks rose on Wednesday as banks and financial shares tracked their U.S. counterparts higher, shrugging off another North Korean missile launch.

The Nikkei share average ended 0.5 percent higher at 22,597.20, while the broader Topix advanced 0.8 percent to 1,786.15.

Japan's Nikkei 225 shrugged off the North's latest missile launch to rise 0.31 percent. Major exporters were mixed as the dollar held onto overnight gains against the yen, with automakers mixed, but tech names mostly higher. Trading houses and financials notched gains.

Retail sales in October declined 0.2 percent compared to one year ago, although the figure remained in line with what was forecast in a Reuters poll. That was the first fall in yearly retail sales in a year, Reuters said.

Across the Korean Strait, the benchmark Kospi index was little changed, trading higher by 0.01 percent as several blue-chip tech names declined. Heavyweight Samsung Electronics lost 1.2 percent while companies that have been sensitive to developments related to the THAAD anti-missile system traded mixed: Lotte Shopping fell 2.11 percent and LG Household and Healthcare advanced 0.08 percent.

Shares of cosmetics names Amorepacific and Cosmax were up 1.29 percent and 4.47 percent, respectively, following news that China would once again let travel agencies resume selling tour packages to South Korea.

Down Under, the S&P/ASX 200 was 0.43 percent higher, with heavily-weighted financial stocks climbing 0.66 percent. Sector-wise, utilities and retail names traded higher.

Greater China markets came under some pressure. Hong Kong's Hang Seng Index slipped 0.3 percent.

On the mainland, the Shanghai Composite shed 0.47 percent and the Shenzhen Composite edged down 0.76 percent. Blue chips sold off on the mainland, with the CSI 300 index down 0.92 percent.

Meanwhile, MSCI's broad index of shares in Asia Pacific excluding Japan was slightly higher, rising 0.11 percent at 1:03 p.m. HK/SIN.

Asia markets close mixed as sell-off in Chinese stocks eases

Asian Stock Markets

Asian markets closed mixed on Friday, following a quiet overnight trading session with U.S. markets closed for the Thanksgiving holiday. Chinese stocks ended the week more than 1 percent lower after a heavy sell-off in the previous session.

Japan's Nikkei 225 reversed early losses to close up 0.12 percent at 22,550.85 as markets reopened for trade after a day off. Losses were seen in automakers and manufacturing names. Technology stocks were a mixed picture: Nintendo rose 3.55 percent, SoftBank Group gained 1.4 percent and Sharp was down 1.26 percent by the end of the day.

Across the Korean Strait, the Kospi tacked on 0.28 percent to end at 2,544.33, with tech heavyweight Samsung Electronics gaining 0.29 percent. Financials drifted slightly lower.

Down Under, the S&P/ASX 200 shed 0.06 percent to close at 5,982.55. The industrials and information technology sub-indexes fell 0.42 percent and 0.74 percent respectively by the end of the session.

In China, the benchmark Shanghai Composite eked out gains of 0.06 percent to close at 3,353.82 after trading in negative territory earlier in the day. The index finished the week 1.14 percent lower. The Shenzhen Composite meanwhile lost 0.09 percent to end at 1,922.72, closing the week down 2.5 percent. The blue-chip CSI 300 index, which suffered its largest one-day fall since June 2016 on Thursday, closed higher by 0.04 percent after choppy trade.

Insurers closed mostly lower, although banks and brokerages finished the session mixed. Airlines finished the session with significant gains, with China Eastern Airlines rising 4.98 percent on the day.

A combination of tighter rules for online micro-lenders and firmer bond prices were seen as reasons for the declines on Thursday. Stocks hit by the recent sell-off had in fact risen in the past weeks and still boasted relatively good fundamentals, according to market watchers. "There was panic selling in the market," said Ronald Wan, chief executive at Partners Capital International.

Hong Kong's Hang Seng Index fared better in comparison, climbing 0.54 percent by 3:25 p.m. HK/SIN after closing 1 percent lower on Thursday. Still, the index remained below the 30,000 mark that it topped for the first time in a decade earlier this week.

Nikkei rises to 1-week high but breaks 9-week winning streak

Asian Stock Markets

Japan’s Nikkei share average rose to a one-week high on Friday, helped by gains in most sectors while chip-related stocks such as Sumco and Tokyo Electron outperformed.

 The Nikkei ended 0.2 percent higher to 22,396.80, the highest closing since Nov. 10. However, it fell 1.3 percent for the week, snapping a nine-week winning streak.

Semiconductor equipment maker Tokyo Electron gained 1.0 percent and semiconductor silicon wafer manufacturer Sumco Corp surged 4.9 percent.

Consumer electronics products makers also staged a rally. Sony Corp gained 0.7 percent and Panasonic Corp advanced 0.8 percent.

On the other hand, utility stocks and paper shares slipped and were the worst performers on the board. Chubu Electric Power dropped 1.1 percent, Hokuriku Electric Power shed 1.4 percent and Tokyo Gas declined 1.7 percent.

Nippon Paper Industries dropped 1.4 percent and Oji Holdings declined 1.2 percent.

The broader Topix gained 0.1 percent to 1,763.76.

RECORD RUN

The year-long global surge in stocks, driven by the pick-up in growth, corporate profits and still ultra-low interest rates, was set to see MSCI’s 47-country ‘All World’ index .MIWD00000PUS top the 2003 run of 11 straight months of gains. 

Wall Street was expected to start fractionally higher following a dip from the last round of record highs on Monday [.N]. 

MSCI’s index of Asia-Pacific shares outside Japan .MIAPJ0000PUS had ended up 0.4 percent, as strong gains in South Korea and Taiwan, which make up roughly a quarter of the index’s weighting, offset weakness in China and Hong Kong. 

Chinese data had shown a sharper-than-expected slowdown in October factory growth.

Beijing’s war on winter air pollution is forcing many northern steel mills, smelters and factories to curtail production, adding to uncertainty amid early signs of a slowdown in the world’s second-largest economy. 

South Korea's KOSPI .KS11 ended up 1 percent at a record high after Seoul and Beijing agreed to normalize relations that have been strained by a year-long standoff over the deployment of a U.S. anti-missile system in South Korea. 

Tech-heavy Taiwan .TWII added 0.4 percent after Apple (AAPL.O) made big gains overnight on hopes of strong demand for its new range of iPhones. 

Japan's Nikkei .N225 closed flat, capped by the overnight weakness in U.S. shares and a stronger yen. The Bank of Japan meanwhile stressed it saw no reason to end its mass stimulus program. 

The dollar's rebound ahead of U.S. trading pulled it off a 10-day low of 113.02 yen JPY= struck after details of charges for former Trump aides were disclosed. It was last at 113.32 yen. 

The euro was softer at $1.1637 EUR=. It had pulled back overnight from a three-month low of $1.1574 on Friday. 

Among commodities, crude oil prices steadied below their recent peaks after being boosted by expectations OPEC-led production cuts would be extended beyond March. [O/R] 

Brent crude futures LCOc1 were down 0.1 percent at $60.80 a barrel after rising to $61 overnight, the highest since July 2015. 

U.S. crude CLc1 was 0.15 percent lower at $54.10 after touching $54.46, its highest since late February.

Spot gold XAU= was also a fraction lower at $1,274 per ounce. It has shed about 0.3 percent so far in October, in what could be its second straight monthly decline.

Asia shares get tech boost from Apple, crude near two-year high

Asian Stock Markets

Asian shares climbed on Monda, as technology stocks were bolstered by solid earnings from U.S. stalwarts and on strong pre-orders for Apple’s iPhone X, while oil hovered around a 2-year peak on concerns of tightening supplies.

European shares, however, were seen easing from five-month highs. London’s FTSE FFIc1 futures were off 0.4 percent, while S&P E-mini futures ESc1 dipped 0.2 percent, suggesting a softer opening on Wall Street later in the day. 

Apple Inc (AAPL.O) said pre-orders for the 10th anniversary iPhone X, which started on Friday, were “off the charts”, a blessing for Asian suppliers such as South Korea’s LG Display (034220.KS) and Taiwan Semiconductor Manufacturing Company (2330.TW). 

Tech stocks were the top gainers in MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS, which was up 0.4 percent. Samsung Electronics (005930.KS) led the charts with a rise of 1.8 percent. 

Energy stocks did well too, with Brent crude LCOc1 at around $60.50 a barrel, its highest since July 2015, after Saudi Arabia agreed to support the extension of a global oil production cut agreement. [O/R] 

Japan's Nikkei .N225 ended little changed but remained around its highest level since mid-1996, having soared 8 percent in October so far. But Chinese shares bucked the trend, with the Shanghai Composite Index .SSEC set for its worst day since Aug. 11.

Global share markets have been on an uptrend since the start of the year, helped by solid corporate earnings and positive economic data across major countries. 

The world share index .MIWD00000PUS has surged 17.6 percent so far in 2017, on track for its best showing since 2013.

In the United States, Alphabet (GOOGL.O) GOOG.L, Amazon (AMZN.O) and Microsoft (MSFT.O) all jumped last week after solid quarterly performances, sending U.S. indexes higher. 

Amazon (AMZN.O) soared 13.2 percent on Friday and was responsible for the biggest boost to the S&P 500 after reporting a quarterly sales surge.

Japan shares at two-decade top, yen near three-month low as Abe wins

Japanese shares jumped on a weaker yen on Monday as an election win for Shinzo Abe’s ruling bloc gave a green light for more policy stimulus, while the euro eased as Spain’s constitutional crisis aggravated concerns about political unity in the region.

The U.S. dollar was the major beneficiary as President Donald Trump and Republicans took a small step toward tax cuts, boosting Wall Street stocks and lifting bond yields. 

Japan's Nikkei .N225 raced up 1 percent to its highest since 1996 after Prime Minister Abe looked to have easily won in national elections over the weekend. 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS held steady, while Singapore's main index .STI reached its highest in over two years. 

Investors assumed Abe’s victory would allow the Bank of Japan to continue with massive monetary easing that depresses bond yields and the yen, even as the U.S. Federal Reserve seems determined to hike rates again in December.

The dollar rose 0.2 percent to 113.74 yen JPY= and briefly touched its highest since mid-July at 114.09. It faces stiff resistance at the July top of 114.49, but a break would open the way to its March peaks around 115.51. Against a basket of currencies, the dollar edged up 0.1 percent .DXY. 

The yen even slipped against the euro EURJPY=, which was having its own troubles as the Spanish government urged Catalans to accept its decision to dismiss their secessionist leadership and to take control of the restive region.

The nation’s biggest political crisis in decades enters a decisive week as Madrid tries to impose its control, although investors have so far assumed the political strife would not spread to elsewhere in the European Union. 

The euro eased only a modest 0.13 percent on Monday to $1.1770 EUR= and has strong chart support around $1.1729.

U.S., Asian shares dip after North Korean missile launch

U.S. stock futures and Asian shares dipped after North Korea fired another missile over Japan into the Pacific Ocean on Friday, demonstrating Pyongyang’s defiance in the face of intensifying sanctions

U.S. stock futures ESc1 fell 0.2 percent while MSCI’s Asia-Pacific share index excluding Japan .MIAPJ0000PUS shed 0.4 percent, though it was still up 0.4 percent on the week. 

Japan's Nikkei .N225 ticked up 0.1 percent. Japan said the North Korean missile fell into sea about 2,000 km (1,240 miles) east of Hokkaido.

The launch came just days after the U.N. Security Council approved new sanctions against Pyongyang for its Sept. 3 nuclear test, but markets are growing accustomed to North Korea’s sabre-rattling. 

Before North Korea’s missile launch, U.S. bond yields had risen while Wall Street shares were mixed after U.S. consumer inflation data rekindled expectations that the Federal Reserve will raise interest rates in December. 

The consumer price index rose 0.4 percent in August from July, faster than the 0.3 percent increase forecast by analysts in a Reuters poll. 

The so-called core CPI, which excludes volatile energy and food prices, rose 0.2 percent. On a 12-month basis, it was 1.7 percent, above the 1.6 percent forecast by economists. 

The 10-year U.S. Treasuries yield US10YT=RR rose to as high as 2.225 percent, but slipped back to 2.178 percent in Asia on Friday following North Korea’s missile launch. 

In currency markets, the dollar failed to capitalise on the CPI data as the rally it begun at the start of the week ran out of steam. 

The euro traded at $1.1910 EUR=, off Thursday's two-week low of $1.18365. The pound hit a one-year high of $1.3407 on Thursday and last stood at $1.3388 GBP=D4.

Oil prices were lower on Friday but largely held gains that had prices flirting with multi-month highs, as the cleanup after hurricanes in the United States gathered pace and the outlook for demand took on a firmer tone. 

Brent crude futures LCOc1 traded at $55.14 per barrel, down 0.6 percent on the day but up 2.5 percent on the week. They hit a five-month high of $55.99 on Thursday. 

Elsewhere, bitcoin BTC=BTSP bounced back 5 percent after having tumbled 16 percent the previous day as Chinese news outlet Yicai reported that the country plans to shut down all bitcoin exchanges by the end of September. 

BTCChina, one of China’s top three exchanges, said on Thursday that it would stop all trading from Sept. 30.

Asia stocks brush off Wall Street slide after Trump's comments

Asian stocks and the dollar edged up on Thursday, shaking off the risk aversion that gripped financial markets overnight after President Donald Trump threatened to shut down the U.S. government and end the North American Free Trade Agreement. 

Financial spreadbetters expect Britain's FTSE 100 .FTSE, Germany's DAX .GDAXI and France's CAC 40 .FCHIto open marginally higher. 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.45 percent.

Japan's Nikkei .N225 pulled back 0.3 percent, with steelmakers slumping after the Nikkei business daily reported that Toyota Motor Corp (7203.T) was looking to cut the price of steel supplied to component makers in the October-March period. 

That is the result of lower rates, agreed for the six months through September with steelmakers such as Nippon Steel & Sumitomo Metal Corp.Three of the five biggest decliners on the index were steelmakers. 

Chinese blue chips .CSI300 were down about 0.3 percent, shrugging off a 23 percent jump in profits for Chinese state-owned firms in the first seven months of 2017 from a year earlier.

Hong Kong's Hang Seng .HSI climbed 0.5 percent. 

South Korea's KOSPI .KS11 added 0.4 percent and Australian stocks gained almost 0.1 percent.

Overnight, U.S. stock indexes closed between 0.3 percent .IXIC .SPX and 0.4 percent .DJI lower. 

Trump said at a Tuesday night rally in Arizona that he would be willing to risk a government shutdown to secure funding for a wall along the U.S.-Mexico border. Those comments came ahead of a late-September deadline to raise the U.S. debt ceiling or risk defaulting on debt payments

Australian Shares Rose, The Euro Edged Dow

Australian shares rose 0.4 percent, while Japan's Nikkei stock index finished down 0.1 percent.

The dollar steadied against its Japanese counterpart, after slumping to four-month lows last week, up 0.3 percent at 119.25.

The euro edged down 0.1 percent to $1.1801, but rose 0.2 percent to 128.92 yen.

The dollar index, which tracks the greenback against a basket of six major rivals, was up 0.1 percent to 93.218. 

The dollar has recently faced selling pressure from tepid U.S. inflation data which have fed into expectations the Federal Reserve will adopt a patient approach to further monetary tightening. 

Political turmoil in Washington has also hampered the greenback as investors have begun to doubt President Donald Trump's ability to implement much of his aggressive stimulus and tax reform measures. 

"The dollar was the loser against all of its pairs and I think that's broadly reflective of fading expectations of what the Fed might do," said Bill Northey, chief investment officer at U.S. Bank Private Client Group in Helena, Montana.

Expectations of what might emerge from the Fed's annual conference in Jackson Hole, Wyoming are also "relatively tempered," Northey said. 

Fed Chair Janet Yellen is scheduled to speak at the conference, but central bank observers do not expect her to give new guidance on policy. 

European Central Bank President Mario Draghi will not deliver any new policy message at Jackson Hole, two sources familiar with the situation said. 

Crude oil prices firmed, lifted by indications that supply is gradually tightening, especially in the United States. 

Brent crude futures added 23 cents to $51.89 per barrel, while U.S. crude rose 18 cents to $47.55.

Asian shares fragile as Trump turmoil, Korea tensions weigh

Asian shares were fragile on Monday as investors remained unconvinced about U.S. President Donald Trump's ability to fulfill his economic agenda, even as the departure of his controversial policy strategist raised hopes of some progress. 

Japan's Nikkei shed 0.3 percent, hitting a 3-1/2-month low, shrugging off a Reuters poll which showed confidence at Japanese manufacturers rose to its highest in a decade in August. 

MSCI's broadest index of Asia-Pacific shares outside Japan was barely in the black thanks to modest gains in China, but many markets, including Australia and South Korea, were in the red. 

European shares are expected to dip, with spread-betters seeing a lower opening of 0.3 percent in Britain's FTSE, and 0.2 percent in France's CAC. 

S&P Mini futures were down 0.1 percent at 2,424, not far from their one-month low of 2,419.5 touched on Friday. 

Wall Street shares got only a short-lived boost on Friday after Trump fired White House chief strategist Steve Bannon.

Although Bannon's departure removes a major source of friction within the White House, Trump's attacks on fellow Republicans following violence in Virginia earlier this month have isolated him, prompting some Republicans to begin questioning Trump's capacity to govern. 

Investors were also wary of any flare-up of tensions between North Korea and the United States as U.S. troops and South Korean forces started a joint exercise on Monday. 

Many investors suspect Pyongyang might respond to the latest drill with more sabre-rattling, such as missile tests, although it has said last week it delayed a decision on firing four missiles toward Guam, home to a U.S. air base and Navy facility. 

Tech-heavy Korean shares - one of the best performers globally for much of this year - have lost momentum since last month, partly on worries about escalating tensions in the Korean Peninsula.

Asia stocks start data-heavy week with gains; dollar creeps up

Asian shares turned positive on Monday, shrugging off a new North Korean missile test as investors turned their attention to a raft of global economic data and earnings this week, while the dollar crept up but remained capped by U.S. political concerns. 

European stocks look set for a muted start, with financial spreadbetter CMC Markets expecting Britain's FTSE 100 .FTSE, Germany's DAX .GDAXI and France's CAC 40 .FCHI to all open little changed. 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS reversed early losses to rise 0.25 percent. 

Chinese shares rose, buoyed by several leading companies' forecasts for strong mid-year earnings. The blue-chip index .CSI300 and the Shanghai Composite .SSEC both rose 0.6 percent. Hong Kong's Hang Seng .HSI climbed 1 percent to a two-year high. 

That strong performance came despite a slip in official Chinese manufacturing and services purchasing managers' indices in July, although they stayed above the 50-point mark that separates growth from contraction on a monthly basis. 

Investors remained wary after North Korea conducted a missile test late on Friday that it said proved its ability to strike the U.S. mainland. The U.S. responded by flying two bombers over the Korean peninsula on Sunday. 

But early jitters dissipated somewhat, with the Korean won KRW= reversing losses. The dollar was down 0.2 percent at 1,120.7 won, after jumping almost 0.7 percent on Friday. South Korea's KOSPI .KS11 fell 0.2 percent.

The perceived safe-haven Japanese yen strengthened, with the dollar shedding 0.15 percent to 110.545 yen JPY=, touching its weakest since mid-June.

Japan's Nikkei .N225 was flat, with the firm yen offsetting news the country's industrial output rebounded in June from a decline in May. Australian shares advanced 0.7 percent.

Asia stocks, dollar steady as investors await Fed clues

Asian stocks steadied on Wednesday and the dollar held firm as investors awaited the Federal Reserve's policy decision later in the day for more clues on its tightening plans. 

The wait-and-see mood was expected to prevail in the European session, with spreadbetters forecasting Britain's FTSE .FTSE and France's CAC .FCHI to open effectively flat while predicting Germany's DAX .GDAXI to inch up 0.05 percent. 

The Fed will conclude its two-day meeting later on Wednesday, and is widely expected to keep interest rates unchanged. 

With a rate hike not in the picture this time, the focus will be on the Fed's statement, with markets looking for signs of when the central bank will begin paring its massive bond holdings and next raise rates. Its statement is expected at 1800 GMT.

Federal funds futures implied traders saw the chance of a Fed rate increase in September at about 8 percent and a December hike possibility at 48 percent. 

A more assertive policy message by the Fed, on the other hand, would likely lift U.S. yields and boost the dollar. 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was little changed, but drew mild support after the S&P 500 .SPX climbed to an all-time high overnight on well-received results from McDonald's (MCD.N) and Caterpillar (CAT.N) in addition to bank share gains. 

Australian stocks gained 1 percent with a smaller-than-expected rise in local inflation supporting views that interest rates will remain at record lows for some time to come. The Australian dollar slipped 0.5 percent to $0.7896 AUD=D4. 

Japan's Nikkei .N225 added 0.5 percent after the dollar rallied against the yen JPY= overnight to pull away from seven-week lows. 

Shanghai .SSEC shed 0.4 percent on lingering fears of further regulatory tightening, while South Korea's KOSPI .KS11 lost momentum after touching a record high the previous day and slipped 0.3 percent.

Euro at two-year high, Asian shares barely budge

The euro held near two-year highs against the dollar on Friday after the head of the European Central Bank said tapering of its stimulus will be on the table this autumn, while a solid global economic outlook kept Asian share prices near decade highs.

Although ECB President Mario Draghi set no date for changes to the bond-buying plan, investors took his comments on Thursday as confirming their expectations that the discussions would lead to monetary tightening next year.

By late Asian trade, the euro stood at $1.1630 EUR=, maintaining its 1 percent gain on Thursday, its biggest since June 27, when Draghi first sparked expectations that the ECB will dial back its bond buying scheme. 

Signs of steady global growth, which have prompted the ECB and a couple of other major central banks to signal future tightening since last month, have kept the world's shares on firm footing. 

European shares are expected to be flat to slightly lower, with spread betters looking at a flat opening in Britain's FTSE .FTSE and a 0.1 percent fall in Germany's DAX .GDAXI and France's CAC .FCHI. 

In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS, which has gained about 5 percent in the past two weeks, eased 0.2 percent on Friday, dragged down by fall in material .MIAPJMT00PUS and financial .MIAPJFN00PUS shares. 

Japan's Nikkei .N225 dropped 0.2 percent. 

MSCI's gauge of stocks across the globe .MIWD00000PUS was down slightly after rising for a 10th straight session on Thursday, its longest such streak since February 2015. It has advanced 3.1 percent in the latest rally. 

U.S. quarterly earnings are expected to have climbed 8.6 percent, above the 8-percent rise projected at the start of the month, according to Thomson Reuters I/B/E/S. About 15 percent of S&P 500 companies having posted results so far.