* U.S. gridlock on stimulus deal dents share prices
* Russia vaccine news triggers escape from safe-haven assets
* Value-oriented shares bought back globally
* Gold, silver tumble for two days in row
* European shares seen falling 0.6%
By Hideyuki Sano and Lawrence Delevingne
TOKYO/BOSTON, Aug 12 (Reuters) - Asian stocks slipped on
Wednesday on growing uncertainty over whether U.S. lawmakers
would strike an agreement on an additional round of big fiscal
stimulus to support an economy still struggling with the
coronavirus pandemic.
Hopes of vaccine development, however, prompted some
investors to reduce safe-haven assets such as gold and
government bonds, and to buy back battered stocks of companies
hit hardest by the virus.
The mixed sentiment has led to choppy trade in Asia with the
index of ex-Japan Asia-Pacific shares shedding 0.76%
.MIAPJ0000PUS while Japan's Nikkei .N225 gained 0.2%.
Mainland Chinese shares .CSI300 fell 1.7%, weighed by
worries about the economic recovery after data showed a slowdown
in the country's money supply and bank lending growth.
European shares are expected to open lower, with Euro Stoxx
50 futures .STXEc1 falling 0.6%.
On Wall Street, the S&P 500 snapped a seven-day winning
streak after coming within reach of its all-time peak hit in
February just before the global outbreak of the COVID-19.
The declines came as political gridlock between the White
House and congressional Democrats over coronavirus relief
continued for a fourth day. Barring a bipartisan deal, the U.S. economy could be left
with measures U.S. President Donald Trump called for on Saturday
through executive orders to bypass Congress. "We have enormous uncertainty. It appears it's getting
harder for both sides to compromise as the election is
nearing... Trump's proposals would be smaller than markets have
expected. There's question over whether they are viable, too,"
said Junpei Tanaka, strategist at Pictet.
The U.S. election campaigns look set to gather steam after
Democratic presidential candidate Joe Biden selected Senator
Kamala Harris as his choice for vice president. The 10-year U.S. Treasuries yield dipped 1 basis points to
0.647% US10YT=RR in Asia after hitting a one-month of 0.661%
in previous trade.
On top of hedge selling ahead of the largest-ever 10-year
note auction later in the day, bonds have lost some of their
safe-haven allure also on rising hopes of vaccines against
COVID-19.
Russian President Vladimir Putin said on Tuesday his country
was the first to grant regulatory approval to a COVID-19 vaccine
after less than two months of human testing. While Moscow's decision raised some eyebrows, the news
lifted hope some of the vaccines currently in development would
become available earlier than expected. Investors bought back hospitality industries stocks and
other value-oriented shares, leading the old-economy centric Dow
Jones .DJI to outperform the tech-focused Nasdaq .IXIC .
Globally, the MSCI Value index .MIWD0000VPUS has risen
1.6% so far this week while the MSCI Growth index
.MIWD0000GPUS lost 1.2%.
The most dramatic move took place in precious metals.
Gold fell 1.6% to $1,881.4 per ounce XAU= , a day after it
suffered its biggest daily fall in seven years. Silver lost 3.2%
to $23.99 per ounce XAG= , following its 15% plunge on Tuesday.
Still, Michael Hsueh, Commodities & FX Strategist at
Deutsche Bank in New York said, there is a good chance this
week's decline will attract fresh buyers.
"In today's instance, the vaccine news is likely not
sufficient to change the macro narrative, insofar as it is seen
as a medical mistake in advancing too quickly through testing
procedures," he said, referring to the Russian vaccine.
Major currencies were little changed, with the euro almost
flat at $1.1728 EUR= and the yen also moving little at 107.27
per dollar JPY= .
The New Zealand dollar slipped 0.4% NZD=D4 after the
country locked down Auckland following four new cases of
COVID-19 and the country's central bank took a dovish stance.
Oil prices edged up after bigger-than-expected drop in U.S.
inventories, with Brent LCOc1 up 0.6% at $44.75 a barrel. U.S.
crude CLc1 was up 0.5% at $41.80.
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MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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