SINGAPORE, Jan 3 (Reuters) – Shares in Asia were higher on Friday, trying to overcome a shabby beginning to 2025, while the dollar was lodged on a two-year peak against a basket of currencies, as investors are concerned about U.S. rates staying elevated for longer.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab rose 0.33% but appears headed for a weekly plunge of almost 1%. It enjoyed nearly an 8% gain in 2024. Japan’s markets closed for the week.
Shares of Chinese companies steadied on Friday after tumbling in the previous session, as fears amplified surrounding China’s economy and possible trade war as Donald Trump was slated to take over the presidency in the month. China’s blue-chip CSI 300 Index (.CSI300) opens new tab.
climbed 0.16 in early trading after logging the weakest start to a New Year since 2016 on Thursday. Hong Kong’s Hang Seng Index rose by 0.19%.
“It has been very tough for equity around the turn of the year, but bizarre things can happen in an illiquid market,” said Ben Bennett, Asia-Pacific investment strategist at Legal and General Investment Management.
“I don’t think this performance should be extrapolated. Even so, a stronger dollar and higher bond yields will remain a downside for sentiment going forward, and equity investors will be hoping for a change very soon.”
In Wall Street shares in U.S.-traded stocks fell, in a general sense, on Thursday after initial gains faltered. Tesla shares sank 6.1% after it announced a year-on-year drop for the first time.
The weak sentiment, this follows an unsteady finish to 2024, dampening an over one-year uptick, focused on growth expectation creeping around artificial intelligence, anticipated Fed interest rate cuts, and, more recently, anticipated regulatory rollback policies by the incoming Trump-led administration.