GLOBAL MARKETS-Asia stocks digest meaty gains, sterling starved for love

Published 20/12/2019, 01:28
Updated 20/12/2019, 01:36
© Reuters.  GLOBAL MARKETS-Asia stocks digest meaty gains, sterling starved for love

* Asian stock markets : https://tmsnrt.rs/2zpUAr4

* Asia shares ex-Japan up 5% so far in December

* Washington insists trade deal done, China more reticent

* Sterling heading for worse week since late 2017

By Wayne Cole

SYDNEY, Dec 20 (Reuters) - Asian shares snoozed near

18-month highs on Friday as trade thinned in the run-up to

Christmas and investors seemed content to digest the chunky

gains already made so far this month.

MSCI's broadest index of Asia-Pacific shares outside Japan

.MIAPJ0000PUS was a fraction firmer in early trade, having

gained 1.2% for the week so far and almost 5% for the month.

Japan's Nikkei .N225 inched up 0.1% after reaching a

14-month top earlier in the week. It was ahead by 2.5% for the

month so far. South Korea's market .KS11 added 0.25% on the

day and 5.5% for December.

E-Mini futures for the S&P 500 ESc1 held at all-time highs

having put on 1.2% for the week.

Sentiment had been bolstered after U.S. Treasury Secretary

Steven Mnuchin said the United States and China would sign their

Phase One trade pact in early January.

Mnuchin said it was completely finished and just undergoing

a technical "scrub," though Beijing has so far dodged all

details of the deal. The U.S. House of Representatives also overwhelmingly

approved a new North American deal that leaves $1.2 trillion in

annual U.S.-Mexico-Canada trade flows largely intact.

The S&P 500 hit a sixth straight record high, its longest

streak since January 2018, and the Nasdaq climbed for the

seventh session in a row. The S&P 500, Nasdaq and Dow all

notched record closing highs. .N

The Dow .DJI ended Thursday up 0.49%, while the S&P 500

.SPX gained 0.45% and the Nasdaq .IXIC 0.67%.

The market shrugged off U.S. President Donald Trump's

impeachment, as the Republican-controlled Senate is widely

expected to keep him in office. IN PERIL

It was mostly quiet in currencies, though sterling was

nursing a grudge after suffering a vicious reversal that left it

facing its worst weekly fall since late 2017 at 2.4%.

Early Friday, the pound was huddled at $1.3017 GBP=D3

having toppled from a $1.3514 peak when Prime Minister Boris

Johnson used his sweeping election victory to revive the risk of

a hard Brexit. "We see the biggest risks being to GBP/USD depreciation over

the next two weeks as Brexit preparations take place amidst the

most sluggish UK economy in 10 years," said Richard Grace, chief

currency strategist at CBA.

"GBP can fall because the trade concerns are taking place at

a time when the UK trade deficit is the widest it has been in 10

years, and the current account deficit is at a historically

large 5.0% of GDP."

Other currency pairs were little changed on the week with

the euro stuck at $1.1124 EUR= having found support around

$1.1100. The dollar idled at 109.36 yen JPY= , having spent the

entire week in a tight 10917/109.67 range.

Against a basket of currencies, the dollar had edged up 0.2%

for the week to 97.393 .DXY thanks mainly to the steep drop in

sterling.

Spot gold was flat at $1,479.00 per ounce XAU= , and up

just a fraction for the week so far.

Oil prices consolidated after reaching the highest level in

three months, buoyed by falling crude inventories and the easing

in U.S.-China trade tensions. O/R

Early Friday, U.S. crude CLc1 had eased back 11 cents to

$61.07 a barrel, while Brent crude LCOc1 futures were yet to

trade.

Asia stock markets https://tmsnrt.rs/2zpUAr4

Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA

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(Editing by Stephen Coates)

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