Stocks Resume Declines; Treasuries Pare Losses: Markets Wrap

Asian stocks reversed earlier gains to trade lower as investors continued to mull the implications of the recent run-up in bond yields. The dollar slipped after President Donald Trump delivered his first State of the Union speech in Washington.

The MSCI Asia Pacific Index declined for a third session led by industrial, energy and real estate shares. Equities in Australia and Hong Kong advanced while those in Japan underperformed. The MSCI All-Country World Index had suffered its biggest two-day slide since September 2016 on Tuesday. U.S. 10-year Treasury yields ticked lower though remained close to the highest since April 2014. The euro and sterling both climbed.

Stocks and the dollar extended declines after Trump concluded his speech, though U.S. equity futures pointed higher. He sought to connect his presidency to the nation’s prosperity, arguing that the U.S. has arrived at a “new American moment” of wealth and opportunity.

Investors have been taking profits as the month draws to a close after one of the best January’s for global equities on record. Warnings about the market’s vulnerability from Amundi Asset Management to Goldman Sachs Group Inc. are being balanced against synchronized global growth and a strong expansion in corporate profits.

Elsewhere, oil retreated and industrial metals reversed losses. A measure of China’s manufacturing sector came in below expectations, while the services gauge topped estimates.

Here are some important things to watch out for this week:

Fed policy makers gather for Chair Janet Yellen’s final meeting on interest rates Wednesday before her term ends. Tech giants Microsoft Corp., Facebook Inc., Alibaba Group Holding Ltd., Apple Inc., Alphabet Inc. and Amazon.com Inc. will announce earnings. Large-caps Exxon Mobil Corp., Merck & Co. Inc., Roche Holding AG, Daimler AG, Deutsche Bank AG and Boeing Co. also report. U.S. employers probably added more jobs in January than a month earlier, economists forecast before the Friday report. On Wednesday, the core euro-zone inflation report may show an uptick from a year ago to 1 percent this month.And these are the main moves in markets:

Stocks

The MSCI Asia Pacific Index fell 0.3 percent as of 4:18 p.m. Tokyo time. Topix index fell 1.2 percent. Hong Kong’s Hang Seng Index rose 0.4 percent. Kospi index fell less than 0.05 percent. Australia’s S&P/ASX 200 Index rose 0.2 percent. Futures on the S&P 500 Index rose 0.2 percent.

Currencies

The Bloomberg Dollar Spot Index fell 0.3 percent. The Japanese yen rose 0.1 percent to 108.72 per dollar. The euro rose 0.3 percent to $1.2441.

Bonds

The yield on 10-year Treasuries fell one basis point to 2.71 percent. Japan’s 10-year yield decreased two basis points to 0.082 percent.

Commodities

West Texas Intermediate crude fell 0.6 percent to $64.13 a barrel. Gold rose 0.4 percent to $1,343.40 an ounce. LME copper rose 0.9 percent to $7,113.50 per metric ton.

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