* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Tracking the coronavirus: https://tmsnrt.rs/3aIRuz7
* Sentiment remains fragile due to worries about virus
* 3-mo/10-yr Treasury yield curve inverts
* Weak German data pummels euro
By Stanley White
TOKYO, Feb 19 (Reuters) - Asian shares and U.S. stock
futures edged cautiously higher on Wednesday as investors tried
to shake off worries about the coronavirus epidemic following a
slight decline in the number of new cases.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.01%. Australian shares .AXJO were up
0.14%, while Japan's Nikkei stock index .N225 rose 0.61%.
The euro languished at a three-year low versus the dollar as
disappointing data from Germany, Europe's largest economy, has
stoked fears that the euro zone is more vulnerable to external
shocks than previously thought.
The Treasury curve remained inverted on Wednesday as yields
on three-month bills traded above yields on 10-year notes in a
sign that some investors remain cautious about the outlook.
China, the world's second-largest economy, is still
struggling to get its manufacturing sector back online after
imposing severe travel restrictions to contain a virus that
emerged in the central Chinese province of Hubei late last year.
Many investors view Chinese data on the virus, dubbed
SARS-CoV-2, with a great deal of scepticism, but there are hopes
that officials will roll out more stimulus to support the
world's second-largest economy.
"Part of the thinking that is supporting markets is the
actions that China takes to support its economy," said Michael
McCarthy, chief market strategist at CMC Markets in Sydney. "Any
investor concern around impact on demand globally from the virus
will be offset by expectations that global central banks will
ride to the rescue."
U.S. stock futures ESc1 rose 0.24% in Asia on Wednesday.
The S&P 500 .SPX fell 0.29% on Tuesday after Apple Inc
APPL.O said it would miss sales targets because the virus in
China is pressuring its supply chain. Mainland China had 1,749 new confirmed cases of coronavirus
infections on Tuesday, the country's National Health Commission
said on Wednesday, down from 1,886 cases a day earlier and the
lowest since Jan. 29. Many investors remain concerned about China's reporting
standards for the virus. In addition, the flu-like illness has
already spread to 24 other countries.
The People's Bank of China cut the interest rate on its
medium-term lending on Monday, which is expected to pave the way
for a reduction in the country's benchmark loan prime rate on
Thursday, as policymakers try to ease financial strains caused
by the virus. In the currency market, the euro EUR=EBS traded at
$1.0796, close to the lowest since April 2017.
The common currency crashed through a closely watched
support level at $1.08 on Wednesday after a survey showed a
sharp deterioration in German investor sentiment due to the
coronavirus. In offshore trade, the yuan CNH=D3 was quoted at 7.0064
per dollar, close to its lowest level in a week, as traders
continued to ponder the economic impact of the virus.
The yield on three-month Treasury bills US3MT=RR stood at
1.5765% in Asia on Wednesday, above the 10-year Treasury yield
US10YT=RR of 1.5593%.
A yield curve inverts when short-term yields trade above
long-term yields and is often considered a sign of recession in
the next year or two.
U.S. crude CLc1 rose 0.21% to $52.16 a barrel as a
reduction in supply from Libya offset concern about weaker
Chinese demand for commodities.
Expectations that Organization of the Petroleum Exporting
Countries (OPEC) and allied producers including Russia will cut
output further should lend support to prices. The group, known as OPEC+, will meet in Vienna on March 6.