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Asia300

Nikkei Asia300 Index ekes out small gains as US bond yields, dollar recoil

MUMBAI (NewsRise) - Asian stocks edged higher Tuesday, as a retreat in U.S. Treasury yields and the dollar lifted regional sentiment, while investors shrugged off mixed inflation data from China.

The Nikkei Asia300 Index rose 0.2% or 2.2 points to 1,061.63 Tuesday. Hong Kong's Tencent Holdings and China Construction Bank (CCB) rose at least 1%, contributing most to gains on the gauge, while CNOOC, China Shipbuilding Industry and Citic fell.

Investors turned risk averse amid concerns of a "hard Brexit" after British Prime Minister Theresa May in an interview with Sky News indicated that Britain will make a clean break from the European Union. The comments spurred demand for top-rated government debt like U.S. Treasury notes and the Japanese yen, weakening U.S. yields and the dollar.

Regional assets have been under pressure over the last two months as expectations that U.S. President-elect Donald Trump will adopt policies that will boost inflation and growth in the world's largest economy lifted U.S. Treasury yields and the dollar to multi-year highs. However, Asian markets have shown some signs of recovery after the Federal Reserve's December minutes, released last week, were not as hawkish as investors feared.

Markets shrugged off data from Asia's largest economy that showed consumer inflation rose 2.1% in December from a year earlier, slowing from November's 2.3% increase, and the monthly Producer Price Index surged by 5.5%, the fastest pace in over five years.

On Tuesday, China's index rose 0.6% to 1,024.56, while the Nikkei Asia300 Hong Kong index added 1.3% to end at 1,013.89 points.

China Shipbuilding Industry fell 2.3% in Shanghai amid weakness in mainland markets. The company said it expects a return to net profit in 2016 after posting a loss the year before. Conglomerate Citic slipped 0.7%, giving up a chunk of Monday's 1.3% advance after it announced plans to buy a stake in McDonald's China business.

CNOOC slumped 1.3% tracking an overnight slide in crude prices. Global crude prices fell almost 4% Monday amid concerns that rising U.S. production may undercut efforts by various producers to help reel in a supply glut.

Caution ahead of a press conference by Donald Trump in New York on Wednesday limited gains in the region, even leading some countries' indexes lower.

The Nikkei Asia300 South Korea Index slipped 1.1% to 1,113.13 points, while Taiwan's gauge slipped 0.2% to 1,154.51. Vietnam's index slipped 0.2% to 1,254.78 points.

India's index eked out a 0.2% gain to end at 1,015.34 points. Automaker Tata Motors jumped 3% to end at 515.30 rupees after its luxury unit reported robust sales for last year.

The Nikkei Asia300 Singapore Index added 0.9% to 1,017.03 points. Ascendas Real Estate Investment Trust and CapitaLand Commercial Trust rose at least 1.6% each, helped by the slide in U.S. Treasury yields. Neighboring Malaysia's gauge ended little changed at 958.70 points.

--Dhanya Ann Thoppil

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