* Asian stock markets: tmsnrt.rs/2zpUAr4
* Nikkei with 1% discount, reduced trade for the US holiday
* Keeping an eye on China’s GDP data for economic prospects
* US dollar and Treasury bills maintain gains as risk appetite increases
SYDNEY, Jan. 18 (Reuters) – Asian stock markets retreated from Monday’s highs, as disappointing news about U.S. consumer spending moderated risk sentiment before a careful reading of the health of the Chinese economy. .
Doubts were also evident about how much of the US President-elect Joe Biden’s stimulus package will reach Congress due to Republican opposition, and the risk of further mob violence in his possession on Wednesday.
MSCI’s broadest Asia-Pacific stock index outside Japan lost 0.3%, having hit a series of record highs in recent weeks. Japan’s Nikkei fell 1% and fell from a 30-year high.
E-Mini futures for the S&P 500 fell 0.3%, although Wall Street is closed on Monday for a holiday.
Chinese GDP data is expected to show an acceleration of growth to 6.1% annually in the last quarter, from 4.9% in the third quarter. The monthly figures for retail sales and industrial production should show accelerated activity at the end of the year.
“We expect Chinese GDP growth in the fourth quarter to accelerate to 6.5% per year above consensus because of robust industrial production, service recovery and strong exports,” said Joseph Capurso, head of international economics at CBA.
“The data will confirm that the Chinese economy ended the year on a solid basis.”
That would be a striking contrast to the US and Europe, where the spread of the coronavirus has hampered consumer spending, underlined by discouraging US retail sales reported on Friday.
“The data question the durability of the recent upward movement in bond yields and the increase in compensation for inflation,” ANZ analysts said in a note.
“There is a lot of good news about vaccines and stock price stimuli, but optimism is being challenged by the reality of the difficult months ahead,” they warned. “The risk across Europe is that the blockages will be extended and cases in the U.S. may increase dramatically as the UK’s COVID variant spreads.”
This will put the focus on earnings guidance for this week’s corporate results, which include BofA, Morgan Stanley, Goldman Sachs and Netflix.
Weak US data helped Treasury bills reduce some of its recent losses and 10-year yields were trading at 1.087%, down from last week’s 1.177% top.
The more sober climate, in turn, boosted the safe-haven dollar, catching a deeply sold bear market. Speculators have increased their short dollar position to the highest since May 2011, in the week ending January 12.
The dollar index duly rose to 90.837, and moved away from its recent 2-1 / 2 year low at 89.206.
The euro retreated to $ 1.2068, from its January peak at $ 1.2349, while the dollar remained stable against the yen at 103.93 and well above the recent low at 102.57.
Biden’s choice for Treasury Secretary Janet Yellen is likely to rule out the search for a weaker dollar when testifying at Capital Hill on Tuesday, the Wall Street Journal reported.
Gold prices were hurt by the dollar’s rise, leaving the metal at $ 1,812 an ounce, compared to the January peak of $ 1,959.
Oil prices have generated profit due to concerns that the spread of increasingly rigid blockages around the world would hurt demand.
Brent crude futures fell 12 cents to $ 54.98 a barrel, while US crude fell 11 cents to $ 52.25.
Editing by Shri Navaratnam