Asia-Pacific markets set to trade cautiously as investors keep an eye on U.S. stimulus talks

  • Australia's benchmark ASX 200 fell 0.48%, with most sectors trading in the red.
  • Nikkei futures pointed to a near flat open for the Japanese market.
  • In the U.S., few signs of progress towards a coronavirus relief package emerged as negotiations dragged on.

SINGAPORE — Asia-Pacific markets were set to trade cautiously on Friday as investors kept an eye on negotiations over additional fiscal stimulus in the U.S.

Australia's benchmark ASX 200 fell 0.48%, with most sectors trading in the red. The heavily-weighted financials subindex declined 0.84% as the country's so-called Big Four banks struggled for gains.

Nikkei futures pointed to a near flat open for the Japanese market.

Friday's session followed a mixed end on Wall Street where the S&P 500 registered back-to-back losses — U.S. futures traded flat.

Markets are "having to balance a weak short-term picture against a much rosier medium-term as vaccines start to be rolled out," said Tapas Strickland, director of economics and markets at the National Australia Bank, in a morning note. "In this environment equities have largely held onto recent gains."

In the U.S., few signs of progress towards a coronavirus relief package emerged as negotiations dragged on. While lawmakers seek to pass a bill before lifelines expire at the end of 2020 — when millions of Americans risk falling deeper into financial peril — disagreement over state and local stimulus, unemployment assistance and stimulus checks still exist.

Meanwhile, an important U.S. Food and Drug Administration advisory panel recommended approval of Pfizer's Covid vaccine for emergency use.

Across the pond, post-Brexit trade talks between the U.K. and European Union remain at an impasse over several notable issues including fishing rights and competition rules. Downing Street said "very large gaps" remain, while EU Commission President Ursula Von der Leyen described the two sides as "far apart."

Currencies and Oil

The U.S. dollar index, which measures the greenback against a basket of its peers, last traded at 90.824.

The Japanese yen changed hands at 104.22 per dollar, relatively flat compared to its previous close. Elsewhere, the Australian dollar slipped 0.11% to $0.7525.

Oil prices rose during Asian trading hours on Friday: U.S. crude futures were up 0.66% at $47.09 a barrel.

Global benchmark Brent meanwhile gained more than 3% in the overnight session.

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