Asian stocks inch up as US dollar stays strong amid economic uncertainty

Asian stocks saw modest gains on Tuesday, with trading activity remaining subdued due to the holiday-shortened week.

The U.S. dollar held near a two-year high, bolstered by rising U.S. Treasury yields, as investors adjusted expectations for fewer Federal Reserve rate cuts in 2025, News.Az reports, citing Reuters.

In China, stocks extended gains slightly on the back of news of more support from Beijing to shore up the country's stuttering economic recovery.

The CSI300 blue-chip index and Shanghai Composite Index last traded 0.9% higher each. Hong Kong's Hang Seng Index advanced 1.08%.

Two sources told Reuters that Chinese authorities have agreed to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, which would be the highest on record.

Chinese government bond yields ticked up in response, with the 10-year yield gaining two basis points to 1.7125%.

The news came shortly after the country's finance ministry said authorities will ramp up fiscal support for consumption next year by raising pensions and medical insurance subsidies for residents as well as expanding consumer goods trade-ins.

Still, investors remain cautious on the outlook for the world's second-largest economy, particularly as it faces the threat of hefty tariffs from U.S. President-elect Donald Trump.

Elsewhere, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.44%, tracking Wall Street's overnight gain.

EUROSTOXX 50 futures ticked up 0.04%, while FTSE futures rose 0.46%. S&P 500 futures and Nasdaq futures each lost 0.05%.

Japan's Nikkei fell 0.24%.

Nippon Steel's $15 billion bid for U.S. Steel has been referred to U.S. President Joe Biden, a White House spokesman said, giving the president 15 days to decide on a tie up he has previously said he opposes.

Shares of Nippon Steel last traded 1.2% higher.

News.Az