By Wayne Cole
SYDNEY (Reuters) – Asian shares snoozed near 18-month highs on Friday as trade thinned in the run-up to Christmas and investors seemed content to digest the chunky gains already made so far this month.
MSCI’s broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> was a fraction firmer in early trade, having gained 1.2% for the week so far and almost 5% for the month.
Japan’s Nikkei <.N225> inched up 0.1% after reaching a 14-month top earlier in the week. It was ahead by 2.5% for the month so far. South Korea’s market <.KS11> added 0.25% on the day and 5.5% for December.
Graphic: Asian stock markets – https://product.datastream.com/dscharting/gateway.aspx?guid=516bc8cb-b44…
E-Mini futures for the S&P 500
Sentiment had been bolstered after U.S. Treasury Secretary Steven Mnuchin said the United States and China would sign their Phase One trade pact in early January.
Mnuchin said it was completely finished and just undergoing a technical “scrub,” though Beijing has so far dodged all details of the deal.
The U.S. House of Representatives also overwhelmingly approved a new North American deal that leaves $1.2 trillion in annual U.S.-Mexico-Canada trade flows largely intact.
The S&P 500 hit a sixth straight record high, its longest streak since January 2018, and the Nasdaq climbed for the seventh session in a row. The S&P 500, Nasdaq and Dow all notched record closing highs.
The Dow <.DJI> ended Thursday up 0.49%, while the S&P 500 <.SPX> gained 0.45% and the Nasdaq <.IXIC> 0.67%.
The market shrugged off U.S. President Donald Trump’s impeachment, as the Republican-controlled Senate is widely expected to keep him in office.
POUND IN PERIL
It was mostly quiet in currencies, though sterling was nursing a grudge after suffering a vicious reversal that left it facing its worst weekly fall since late 2017 at 2.4%.
Early Friday, the pound was huddled at $1.3017
“We see the biggest risks being to GBP/USD depreciation over the next two weeks as Brexit preparations take place amidst the most sluggish UK economy in 10 years,” said Richard Grace, chief currency strategist at CBA.
“GBP can fall because the trade concerns are taking place at a time when the UK trade deficit is the widest it has been in 10 years, and the current account deficit is at a historically large 5.0% of GDP.”
Other currency pairs were little changed on the week with the euro stuck at $1.1124
Against a basket of currencies, the dollar had edged up 0.2% for the week to 97.393 <.DXY> thanks mainly to the steep drop in sterling.
Spot gold was flat at $1,479.00 per ounce
Oil prices consolidated after reaching the highest level in three months, buoyed by falling crude inventories and the easing in U.S.-China trade tensions.
Early Friday, U.S. crude
(Editing by Stephen Coates)