Asia stocks start lower as stellar run assessed

A pedestrian walks past quotation boards flashing the key Nikkei index of the Tokyo Stock Exchange.
A pedestrian walks past quotation boards flashing the key Nikkei index of the Tokyo Stock Exchange.PHOTO: AFP

SYDNEY (BLOOMBERG) - Asian stocks started trading lower on Thursday (Aug 3) after surging to the highest level in almost 10 years, with investors assessing the strength of company earnings before American labour-market data provides the latest clues on the health of global growth.

Stocks from Japan to Australia retreated, dragging down the MSCI Asia Pacific Index from its highest since December 2007.

Japan's Topix index was little changed as of 9:25am in Tokyo. Australia's S&P/ASX 200 Index lost 0.6 per cent as Rio Tinto shares tracked their London stock lower.

South Korea's index tumbled 1.2 per cent, pulled lower by Samsung Electronics and engineering stocks that declined on additional government measures to cool the housing market.

Futures on the S&P 500 Index lost 0.1 per cent. The underlying gauge added 0.1 per cent and the Dow Jones Industrial Average rose 0.2 per cent to cross 22,000 for the first time on Wednesday.

Tesla shares were up more than 7 per cent in after-hours trading after the company burnt through less cash than expected in the second quarter.

The US dollar held near a two-year low as Federal Reserve speakers expressed caution over further interest-rate increases. The euro, the best-performing Group-of-10 currency this year, maintained its surge against the dollar and the 10-year Treasury yield was at 2.26 per cent.

Corporate results are dominating sentiment this week, with investors betting profit growth warrants higher equity prices. Friday's report on the US employment market may provide the next inflection point, as investors look for clues on the strength of the world's largest economy and the Federal Reserve's next policy move.

The yen was little changed against the dollar at 110.68.

The Bloomberg Dollar Spot Index was little changed after slipping 0.1 per cent on Wednesday.

The euro was at US$1.1848 after climbing 0.4 per cent in the previous session.

West Texas Intermediate crude slipped 0.2 per cent in early trading to US$49.48 per barrel. It rose 0.9 per cent on Wednesday. Record demand for gasoline helped ease concerns that increasing crude production from America's shale fields will worsen a global glut.