<figure id="attachment_2946214" aria-describedby="caption-attachment-2946214" style="width: 1600px" class="wp-caption aligncenter"><img loading="lazy" class="wp-image-2946214 size-full" src="https://media.freemalaysiatoday.com/wp-content/uploads/2024/12/23c695c7-nikkei-asia-stock-bloomberg-21012019_1600x1000_1.webp" alt="" width="1600" height="1000" /><figcaption id="caption-attachment-2946214" class="wp-caption-text">Asian tech stocks are particularly vulnerable, having outperformed US peers this year on optimism around China’s AI advances. (Bloomberg pic)</figcaption></figure>
SYDNEY: Asian markets are set for a cautious start to the week as investors weigh lingering pressure on tech stocks and uncertainty from the prolonged US government shutdown.
Equity futures point to modest gains for Australian and Japanese stocks, while those in Hong Kong may slip.
The S&amp;P 500 erased earlier losses on Friday as optimism grew that a deal to end the shutdown is nearing.
Senate Republican leader John Thune said he plans to test support Sunday for a narrow spending package, though it’s unclear whether Democrats will back the measure.
Markets remain on edge after last week’s sharp selloff in technology shares reignited concern over stretched valuations.
Asian tech stocks are particularly vulnerable, having outperformed US peers this year on optimism around China’s AI advances.
Adding to the caution is a dearth of fresh data to guide investors on the health of the US economy.
“The week ahead will depend on whether the US government can orchestrate an end” to the shutdown, Kyle Rodda, a senior analyst at Capital.com, wrote in a note to clients.
While Wall Street’s rally late Friday had glossed over some of the negativity in markets, “the move was ultimately little more than putting lipstick on the proverbial pig”.
Chinese assets will be in focus today after consumer prices unexpectedly rose 0.2% in October from a year earlier, as holidays during the month boosted travel, food and transport demand.
Factory-gate deflation also eased.
The S&amp;P 500 rose 0.1% on Friday, rebounding from an earlier test of its 50-day moving average after a reading of US consumer sentiment fell to a more than three-year low.
The yield on 10-year Treasuries edged higher while the dollar dropped 0.2%.
The greenback is likely to trade in a range for the time being, Commonwealth Bank of Australia strategists led by Joseph Capurso wrote in a note to clients.
“Even if the shutdown ends this week, it will take some time for data to be released again.
&#8220;Several FOMC members have signaled reluctance to cut interest rates further while important economic data is not being released,” Capurso said.
Elsewhere, Reserve Bank of Australia (RBA) deputy governor Andrew Hauser is expected to reiterate the central bank’s concern over inflation pressures at a speech today.
The RBA’s cautious stance is likely to keep supporting the Australia dollar, according to strategists, which is on track for a rare annual gain this year.

MatchPoint Times

Asian traders cautious over tech, shutdown concerns

Markets remain on edge after last week’s sharp selloff in technology shares reignited concern over stretched valuations.

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