Asian Stocks Fluctuate, Dollar Dips After US Data: Markets Wrap

(Bloomberg) -- Stocks in Asia drifted at the start of the week as traders refrained from making riskier bets after lackluster economic data spurred a selloff on Wall Street. The dollar declined against its peers, notably the euro. 

Benchmarks in Hong Kong and mainland China, which got a lift from technology stocks this year, traded in tight range. A gauge of Asian equities edged lower after hitting a four-month high Friday. US equity index futures advanced, as did contracts on Germany’s benchmark stock index after the conservative party came in first in the country’s federal election.

The prospects for artificial intelligence has fueled a rally in Chinese technology stocks, offsetting the risks from US tariffs and shifting wagers on Federal Reserve policy easing. Data late last week showed US inflation expectations rising to the highest level in almost three decades. 

“People have not believed in the innovation power of China but also it’s massively under-owned by foreigners,” said Virginie Maisonneuve, global chief investment officer equity at Allianz Global Investors. “I do think you will see some allocation from global funds into China, particularly into the tech area.” 

Chinese tech shares have staged a bull run this year, driven by optimism over DeepSeek and Xi’s meeting with major business leaders, including Alibaba Group Holding Ltd. co-founder Jack Ma. The euro area’s leading blue-chip index gained nearly 12% during that time span, outperforming the S&P 500.

One of the highlights of the week will be Nvidia Corp.’s earnings on Wednesday. Investors have started to boost bets that volatility will come back, with the tech firm’s results the first in a series of events with the potential to send the market into a tailspin. 

Treasury futures slipped on Monday. There was no cash Treasuries trading in Asia, as Japan’s markets were closed for a holiday on Monday. 

A gauge of the dollar weakened during early Asian trading. The euro outperformed among Group of 10 currencies, up 0.5% against the dollar after Germany’s conservative leader Friedrich Merz said he’ll move quickly to form a new government following Sunday’s federal election victory.

In Asia, diagnostic kits and vaccine maker shares climbed as researchers in China said they discovered a new coronavirus in bats that enters cells using the same gateway as the virus that causes Covid-19.

Tariff Tensions

Chinese Vice Premier He Lifeng expressed “serious concern” over President Donald Trump’s 10% tariff hike on Chinese goods in a call with Treasury Secretary Scott Bessent, China Central Television reported Friday. For his part, Bessent also signaled concerns on a host of issues with China, including “economic imbalances,” the US Treasury said.

The Trump administration told Mexican officials that they should put their own duties on Chinese imports as part of their efforts to avoid tariffs threatened by the US president, according to people familiar with the matter.

Separately, Trump is directing the Committee on Foreign Investment in the United States to restrict Chinese spending on technology, energy and other strategic US sectors, his administration’s latest salvo against the world’s second-largest economy.

In corporate news, Berkshire Hathaway Inc. is looking to increase ownership in Japan’s five largest trading houses “over time,” Warren Buffett said in an annual letter to shareholders. 

In commodities, oil held a decline as the prospect of increased supply from Iraq weighed on prices. Gold traded just shy of last week’s all-time high as unexpectedly weak economic data and rising expectations for inflation helped boost haven demand. 

Key events this week:

• Eurozone CPI, Monday
• Israel rate decision, Monday
• South Korea rate decision, Tuesday
• US consumer confidence, Tuesday
• Richmond Fed President Tom Barkin speaks, Tuesday
• Thailand rate decision, Wednesday
• Nvidia earnings, Wednesday
• G-20 finance ministers and central bank governors meet in Cape Town though Feb. 27
• Atlanta Fed President Raphael Bostic speaks, Wednesday
• Germany CPI, unemployment, Friday
• India GDP, Friday
• Japan Tokyo CPI, industrial production, retail sales, Friday
• US PCE inflation, income and spending, Friday
• Chicago Fed President Austan Goolsbee speaks, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures rose 0.5% as of 1:08 p.m. Tokyo time
• Australia’s S&P/ASX 200 was little changed
• Hong Kong’s Hang Seng fell 0.5%
• The Shanghai Composite fell 0.1%
• Euro Stoxx 50 futures rose 0.3%

Currencies

• The Bloomberg Dollar Spot Index fell 0.3%
• The euro rose 0.6% to $1.0516
• The Japanese yen was little changed at 149.20 per dollar
• The offshore yuan rose 0.3% to 7.2348 per dollar

Cryptocurrencies

• Bitcoin fell 0.2% to $95,533.76
• Ether fell 3.1% to $2,720.36

Bonds

• Australia’s 10-year yield declined seven basis points to 4.44%

Commodities

• West Texas Intermediate crude fell 0.2% to $70.24 a barrel
• Spot gold rose 0.2% to $2,940.60 an ounce

This story was produced with the assistance of Bloomberg Automation.

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