Asian Stocks Weaken as Investors Look to State of the Union

By FeaturesDow Jones Newswires

Stocks markets in Asia mostly continued to weaken early Wednesday as investors awaited U.S. President Donald Trump's State of the Union address.

The Dow Jones Industrial Average suffered its worst day since May on Tuesday and several Asian equity benchmarks saw their biggest losses in weeks. Some regional markets were down about 0.5% Wednesday though indexes in South Korea, Japan and New Zealand turned higher in recent action.

Continue Reading Below

"When you have seen a market that has seen such a strong move, it doesn't take a lot (to it pull back)," said Chris Weston, chief market strategist at IG Markets in Melbourne.

Coming into this week, Hong Kong's Hang Seng Index was up 10% this month after jumping 36% in 2017.

The week's pullback has come as global bond yields continue to rise, with the 10-year Treasury's at its highest levels since April 2014.

Investors were looking to the State of the Union address in the U.S., to see if Mr. Trump would make any announcements which could impact trade or the economy.

Excerpts of the address released by the White House pointed to a more conciliatory tone to be adopted by Mr. Trump and a willingness to work across the aisle with Democrats.

"I am extending an open hand to work with members of both parties, Democrats and Republicans, to protect our citizens, of every background, color, and creed," the text of the speech showed.

"Markets aren't expecting any fireworks" from the address "although Asia will somewhat look towards any statements on trade," said Mr. Weston at IG Markets. Investors will also be watching any statements regarding China.

U.S. oil futures have fallen another 1% after an industry group said domestic inventories rose more than what is expected to be announced by the government in its weekly reading on Wednesday.

The dollar is slightly lower after ticking down Tuesday, per the WSJ Dollar Index. Bitcoin continues its slide of the past 48 hours, sitting around $9,800 in recent trading versus $11,700 Monday morning in Asia, according to CoinDesk.

Write to Kenan Machado at kenan.machado@wsj.com

(END) Dow Jones Newswires

January 30, 2018 20:49 ET (01:49 GMT)

Continue Reading Below