Gold prices just lower; monthly gains on track
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* MSCI ex-Japan eases slightly, Japan's Nikkei stumbles
* Japan's GDP shrinks at fastest pace in 6 years
* Singapore downgrades growth outlook due to coronavirus
By Swati Pandey
SYDNEY, Feb 17 (Reuters) - Asian shares stepped back from
three-week highs on Monday as investors weighed the near-term
hit on global growth from a fast-spreading coronavirus outbreak
in China, although expectations of further policy stimulus
helped stem losses.
Trading is expected to be light as U.S. stocks and bond
markets will be shut on Monday for a public holiday.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS dipped 0.1% to 555.50, easing further from last
week's top of 558.30, which was the highest since late January.
Australian shares and South Korea's KOSPI index .KS11 were
each down 0.3%.
Japan's Nikkei .N225 fell more than 1% after data showed
the country's economy contracted at an annualised pace of 6.3%
in October-December, shrinking at the fastest pace since the
second quarter of 2014. The hit to the world's third-largest economy comes amid
fresh concerns about weakness in the current quarter, as the
coronavirus damages output and tourism, stoking fears Japan may
be on the cusp of a recession.
Worryingly, Singapore downgraded its 2020 economic growth
forecast due to the coronavirus outbreak, while China's economy
is also widely expected to take a sharp hit. Within China's Hubei province - the epicentre of the
coronavirus epidemic, authorities reported 1,933 new cases on
Monday, about 5% higher than the previous day. Nationwide figures, due later in the day, are also expected
to show an increase from the 2,009 cases last reported.
In a bid to help cushion the jolt from the epidemic, China's
Finance Minister announced plans on Sunday to roll out targeted
and phased tax and fee cuts to help relieve difficulties for
businesses.
"There is also an expectation of fresh monetary policy
support this week (from China) with a possible reduction of 5
basis points when the monthly prime loan rate is set," said Ray
Attrill, head of forex strategy at National Australia Bank.
BULL RUN
Asia's woes have yet to spread elsewhere, with Wall Street
indexes scaling record highs. .N
E-Mini futures for the S&P500 ESc1 were up 0.1% in early
Asian trading on Monday.
Talk of a U.S. middle class tax cut and a proposal to
encourage everyday Americans to invest in the equities market
boosted share market sentiment late last week, Betashares chief
economist David Bassanese said.
Bassanese had misgivings about the plan, saying it reminded
him of former U.S. President George Bush encouraging Americans
to buy a home during a housing boom.
"It adds to my suspicion that this decade-long bull market
could eventually end via a blow-off bubble, driven by central
bank persistent low interest rate policy," he said in a note.
Later in the week, flash manufacturing activity data for
February are due for the Eurozone, the United Kingdom and the
United States which is likely to capture at least some of the
early impacts of the viral epidemic.
Action was relatively muted in the currency markets, with
the dollar flat against the yen at 109.74 JPY= . It was
unchanged on the pound at $1.3049 and a tad weaker on the euro
The risk-sensitive Aussie AUD=D3 , which is also played as
a liquid proxy for the Chinese yuan, was also barely moved at
$0.6716.
That left the dollar index at 99.093.
In commodities, gold XAU= inched slightly lower to
$1,583.15 an ounce.
Oil futures were mixed with Brent crude LCOc1 down 8 cents
at $57.24 and U.S. crude up 4 cents at $52.09.
Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>