Asia-Pacific Stocks Follow U.S. Markets Lower

By FeaturesDow Jones Newswires

Asia-Pacific markets followed U.S. stock benchmarks lower and U.S. government borrowing costs continued to rise.

Buyers of utility stocks are usually lured by the promise of dividends and the shares therefore react negatively to higher rates. Utilities and energy stocks were lower in Australia Tuesday, which pushed the S&P/ASX 200 down 0.6%.

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The Australian benchmark is now in negative territory for the year.

Meanwhile, despite a modest rebound for the U.S. dollar overnight, the Nikkei Stock Average fell 0.4% in Japan. The dollar was recently around Yen108.95, versus Yen108.77 when Tokyo stock trading ended Monday.

Some analysts are becoming more cautious about on equities.

Capital Economics said emerging-market stocks' "flying start" to 2018 isn't likely to last. "We forecast that China's economy will slow in the coming months," it said, adding that it is unlikely that growth rebounds in smaller emerging-market economies like Brazil will pick up the slack.

Korea's Kospi, after hitting three-straight record closing highs, was down 0.4%. Taiwan shares were lower as well.

Elsewhere, U.S. President Donald Trump will deliver his first State of the Union address in about 24 hours and 10-year Treasury yields are at their highest level in nearly four years, at just higher than 2.7%.

American inflation data for December fell below its target and showed a slight loss in momentum. Still, Fed-fund futures were showing no chance of a rate increase by the Federal Open Market Committee; its two-day meeting begins Tuesday. The next increase isn't expected until March.

The global oil benchmark was recently 0.3% lower in Asia trading.

Write to Gregor Stuart Hunter at gregor.hunter@wsj.com

(END) Dow Jones Newswires

January 29, 2018 20:50 ET (01:50 GMT)

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