SYDNEY: Asian stocks looked set for modest losses following a weak US session as investors mulled an uncertain economic backdrop and mixed signals on trade negotiations.
Treasury yields jumped.
Futures in Japan, Hong Kong and Australia pointed lower after weaker than expected data from Europe and the US reignited worries about the world economy.
US durable goods orders were below expectations and home sales missed estimates.
The dollar edged higher amid reports signalling uneven progress in US-China trade talks as next week’s deadline for more tariffs nears.
The Aussie recouped some losses after the nation’s Treasurer said China had not banned its imports.
The weakness in equities comes after the MSCI’s global gauge of stocks surged 15% in less than two months on optimism over a US-China trade agreement.
Despite increasing confidence a deal can be done, investors shouldn’t expect the stellar run for risk assets to continue at this pace, said Richard Turnill, global chief investment strategist at BlackRock.
“Don’t chase the rally,” Turnill told Bloomberg TV. “Don’t extrapolate the double-digit gains we’ve seen in the first six weeks of this year.”
In focus on Friday will be parliamentary testimony from Reserve Bank of Australia Governor Philip Lowe, then European Central Bank President Mario Draghi will speak later in the day.
Elsewhere, West Texas oil fell below US$57 a barrel after an industry report showed American crude stockpiles continue to swell.
In Europe, lenders led shares lower as minutes of the latest ECB meeting showed policy makers setting up their March gathering as a key session to render their verdict on a regional slowdown and whether new long-term bank funding is required.