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Asia: Stocks point higher as global markets calm after poll

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[SYDNEY] Asian stocks looked set to edge higher as calm ensued in global markets following the turmoil resulting from Donald Trump's shock US election victory. The yen held losses against the US dollar.

Australian and New Zealand equity indexes were higher and Japanese futures indicated a strong open as the US dollar climbed to a five-month high against the yen. Crude oil maintained gains as Opec members were said to be making a final diplomatic push toward securing a deal to cut output. Bonds and emerging-market assets halted a selloff.

Mr Trump's victory sent bond yields surging around the world driven by signals he'll spend as much as US$1 trillion to rebuild infrastructure in a move that investors are betting will boost inflation and make the Federal Reserve speed up the pace of US interest-rate increases. Fed Governor Daniel Tarullo said a rate rise next month is more likely than before, with fed funds futures giving it a 94 per cent probability.

"Things might have got a little bit overdone with the market having got very excited about reflation and what it's going to mean," said Mark Lister, head of private wealth research at Craigs Investment Partners in Wellington, which manages about US$7.2 billion.

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"Most of the sharp adjustment is behind us now and from here you'll need to see tangible evidence of some of those policy moves."

The yen traded at 109.01 per US dollar after slumping the past two days. The Bloomberg Dollar Spot Index, which tracks the US currency against 10 major peers, lost 0.1 per cent on Tuesday after surging 2.8 per cent last week, the most since 2011.

Nikkei 225 futures gained 1.2 per cent in Osaka to 17,860, while Singapore-listed contracts on the Japanese index added 1.3 per cent lower to 17,870. 

Chicago traded futures on the Nikkei 225 Stock Average were 0.1 per cent lower in most recent trading.

In Korea, futures on the Kospi index in Seoul advanced 0.6 per cent. Hang Seng and Hang Seng China Enterprises Index futures in Hong Kong fell as much as 0.1 per cent, as FTSE China A50 Index futures were up less than 0.1 per cent.

New Zealand's S&P/NZX 50 Index, the first market in the Asia Pacific region to open, climbed 0.6 per cent. Australia's S&P/ASX 200 Index advanced 0.2 per cent.

Futures on the S&P 500 Index were little changed after the underlying gauge climbed 0.8 per cent. The Dow Jones Industrial Average closed at a record high.

Oil maintained Tuesday's 5.8 per cent surge, trading at US$45.75 per barrel in early trading Wednesday. Qatar, Algeria and Venezuela are leading the effort to finalise a deal, a delegate familiar with the talks said.

BLOOMBERG

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