Market Watch: High Yields and Volatile Shares

Asian shares began the week tepidly amid high Treasury yields impacting Wall Street valuations. South Korean Jeju Air's shares plummeted post-crash. The U.S. dollar remained strong, affecting gold and oil prices. Political uncertainty in South Korea and U.S. policy shifts under Trump are key influencing factors.

Asian shares commenced the week on a subdued note, as elevated Treasury yields posed a challenge to Wall Street's valuation metrics, while supporting the U.S. dollar's surge near multi-month highs. Trading volumes remained thin with the New Year holiday approaching and a relatively light economic calendar this week.

China's PMI factory surveys are anticipated on Tuesday, followed by the U.S. ISM survey on Friday. MSCI's broad Asia-Pacific index outside Japan decreased by 0.2%, yet retains a 16% annual increase. Japan's Nikkei eased by 0.9% but maintains about 20% gains for 2024. Conversely, South Korea faced political unrest, seeing a 9% loss this year, despite a slight increase of 0.3% recently.

South Korean budget carrier Jeju Air saw its share value plunge drastically after a fatal plane crash, while Chinese blue chips appreciated slightly. With Wall Street experiencing a broad sell-off, experts suggest cautious investment decisions amid potentially prolonged restrictive monetary policy from the Fed and Trump's anticipated policy shifts.

(With inputs from agencies.)