Asia is gloomy after Wall Street tech-inspired rally

HONG KONG / NEW YORK (Reuters) – Asian stocks edged higher on Tuesday as Sino-U.S. Tensions weighed on optimism generated by the Wall Street tech rally, as the dollar fell against nearly all major currencies.

The Trump administration said Monday it would further tighten restrictions on Chinese company Huawei Technologies Co, in an effort to restrict its access to commercially available chips.

The largest MSCI index of Asia-Pacific stocks outside of Japan gained 0.19%, to stay close to its pre-pandemic high in late January.

Japan’s Nikkei plunged 0.52%, while most markets traded in a narrow band with Chinese blue chips falling 0.25%. The Australian benchmark rose 0.12%.

The E-Mini futures for the S&P 500 were stable.

The Nasdaq hit a record close on Monday and the S&P 500 approached its own all-time high, with both indices being lifted by tech stocks.

“We have seen a certain force in the technology again with semiconductors driving the boat,” Thomas Hayes, president of Great Hill Capital, said of the American rally.

The US dollar has softened against most currencies after disappointing manufacturing and mortgage data, wrote Joseph Capurso, analyst at the Commonwealth Bank of Australia, in a note.

But moves were modest before the Federal Reserve minutes were released on Wednesday, with speculation that the Fed will adopt an average inflation target, which would seek to push inflation above 2% for some time.

Bitcoin has hovered near the 13-month high it hit on Monday.

On the commodity front, oil prices edged down on Tuesday, but still held gains overnight after OPEC + said the producer group was almost fully complying with production cuts. .

Brent fell 6 cents, or 0.1%, to $ 45.31 a barrel, after rising 1.3% on Monday. U.S. crude fell 0.2% to $ 42.81 per barrel, after rising 2.1% in the previous session

The safe haven gold closed higher after Berkshire Hathaway also disclosed a stake in Barrick Gold Corp, one of the world’s largest mining companies.

Spot gold added 0.4% to $ 1,995 an ounce.