The euro was down 0.07% to $1.06, after rising 0.6% on Monday. The dollar index , which measures U.S. currency against six other peers, rose 0.048% and was set to snap a four month losing streak. U.S. crude rose 0.13% to $75.78 per barrel and Brent was at $82.29, down 0.19% on the day. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates YTD Global asset performance Asian stock markets ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Ankur Banerjee)
Twitter: @AnkurBanerjee17;)) By Ankur Banerjee
SINGAPORE, Feb 28 (Reuters) - Asian shares nudged higher on
Tuesday, tracking small gains on Wall Street, while the U.S.
dollar paused after a sharp rally as month-end flows lift
sentiment and investors adjust to expectations of more interest
rate hikes.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.25% higher but was set to end the month
down about 6%. Japan's Nikkei rose 0.44%, while
Australia's S&P/ASX 200 index gained 0.51%.
China shares was up 0.4% while Hong Kong's Hang Seng
index was 1% higher but was on track to end its three
month winning streak as the China reopening rally loses steam.
"The reopening story doesn't seem to be providing much
uplift currently," ING economists said.
China shares have also been weighed down by rising
geopolitical tension, with U.S.-China relations the dominant
uncertainty at the forefront of investor minds.
ActivTrades market analyst Anderson Alves said month-end
flows will likely drive short-term price action as traders
rebalance portfolios and market exposure.
"Investors are likely to be monitoring any escalation from
the Russia-Ukraine war," Alves said.
"Any concrete action from China in support of Russia could
be seen as a strong rationale for a derisk and deleverage from
Asian exposure."
Overnight, U.S. stocks eked out a slight gain as investors
engaged in some bargain hunting after last week's steep losses,
as jitters persisted about coming interest rate hikes to tame a
stubbornly high inflation rate. Data on Monday showed U.S. core capital goods orders
accelerated in January, beating forecasts, while contracts to
buy previously owned U.S. homes rose the most in more than 2-1/2
years in January.
Monday's data comes after a hotter-than-expected personal
consumption expenditure report on Friday reinforced expectations
of the U.S. Federal Reserve needing to stay on its hawkish path
for longer.
Fed futures now reflect rates peaking at around 5.4%,
implying at least three more hikes from the current 4.50% to
4.75% band, and some chance of 50 basis points in March.
Barclays and Natwest on Monday said they believe the Fed
could raise rates by as much as half a percentage point in
March, well above the quarter-point that markets have priced in.
In the currency market, sterling was last trading
at $1.206, down 0.02% on the day, having jumped 1% overnight
after Britain struck a new trade deal with the European Union,
which brightened the outlook for the post-Brexit UK economy.
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