Stocks, dollar recover as markets try to move past Trump policy stumble
Stocks, dollar recover as markets try to move past Trump policy stumble:- Asian stocks advanced on Tuesday after Wall Street steadied and the dollar bounced from a four-month-low, as anxiety over Donald Trump's setback on healthcare reform gave way to tentative hopes for the U.S. President's planned stimulus policies.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS added 0.6 percent.
Japan's Nikkei .N225 jumped 1 percent, its biggest one-day gain in more than two weeks, while Australian stocks were up 1.1 percent.
South Korean stocks .KS11 climbed 0.3 percent after data showed the domestic economy grew at a slightly faster pace than initially thought in the fourth quarter of 2016, supported by strong construction activity.
Hong Kong's main Hang Seng .HSI added 0.6 percent.
China's market was one of the region's underperformers, with the CSI 300 .CSI300 index about 0.2 percent lower and the Shanghai Composite .SSEC down 0.4 percent.
Overnight, the S&P 500 .SPX and the Dow Jones Industrial Average .DJI closed lower but had narrowed their losses from earlier in the session, when both hit near-six-week lows. The Nasdaq .IXIC ended higher.
Risk appetite had evaporated after Trump's failure to garner enough support last week to pass a bill repealing the Affordable Care Act, former President Barack Obama's signature health care bill, even with a Republican-controlled Congress.
That blow for Trump spooked global risk assets on concerns about the president's ability to enact stimulus policies. The MSCI World index .MIWD00000PUS, which had stumbled last week, managed to recover, as confidence returned that the Trump administration will corral Congressional support for other pro-growth policies.
"Markets appear reluctant to take the Trump disappointment too much further at this stage," Ric Spooner, chief market analyst at CMC Markets in Sydney, wrote in a note.
"With U.S. economic growth showing signs of improvement and the (Federal Reserve) clearly embarked on a monetary tightening cycle, the significant correction that has already occurred in bonds and the U.S. dollar may already reflect an adequate wind-back of the market’s Trump exuberance."
The U.S. 10-year bond yield US10YT=RR, which hit a one-month low on Monday, was steady at 2.3746 percent on Tuesday.
The dollar was also little changed at 110.62 yen JPY=D4 after recovering from its lowest level since November on Monday.
The dollar index .DXY inched up to 99.23 after slumping to a 4-1/2-month low on Monday.
The euro EUR=EBS was steady at $1.0861 on Tuesday, after touching its highest point since November on Monday.
In commodities, the return of risk appetite and the dollar's relative weakness helped lift oil from a level close to the 3-1/2-month low seen last week, but gains were capped by lingering concerns about whether OPEC-led output cuts can offset surging U.S. production.
U.S. crude CLc1 gained 0.5 percent to $47.97 a barrel, after dropping as much as 1.9 percent on Monday.
Global benchmark crude LCOc1 rose 0.4 percent to $50.95.
Gold XAU= was little changed at 1,253.41 an ounce on Tuesday, after pulling back from the one-month-high hit on Monday.
Source:- http://www.reuters.com/article/us-global-markets-idUSKBN16Z04N
