Asia stocks edge up as techs lift Wall St, Italy still a worry

Asian stocks edged up on Wednesday after tech sector strength lifted Wall Street shares, while concerns about Italy’s debt prompted investors to move into lower-risk government debt elsewhere, pushing US Treasury yields down from recent highs.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1%, while Japan’s Nikkei edged down 0.1%.

Australian stocks rose 0.3%.

The Nasdaq closed at a record high for the second day in a row on Tuesday with help from the technology and consumer discretionary sectors amid an upbeat outlook for the US economy.

But the S&P 500 dipped, with the financial sector hit by lower Treasury yields, which can reduce banks’ profits.

Treasury yields fell as investors moved back into safe-haven government debt after Italy’s new Prime Minister Giuseppe Conte vowed to enact economic policies that could add to the nation’s already-heavy debt load.

On the other hand, the debt concerns caused Italian government bond yields to rise again after they had declined to one-week lows on Monday.

“The Italian political situation will remain uncertain, and considering its potential impact on European Central Bank policy, market volatility could continue to relatively high,” said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management.

The currency market’s response to comments from the new Italian prime minister was more positive, with the euro gaining after Conte said the government had no plans to leave the euro zone.

The euro was a shade higher at $1.17 after gaining about 0.2% overnight. The currency had fallen to a 10-month low of $1.15 on May 29 on worries about Italy exiting the euro zone.

The dollar index against a basket of six major currencies fell 0.1% to 93.833.

The US currency was little changed at 109.850 yen after being nudged off a near two-week high above 100.00 scaled the previous day as US yields fell overnight.

The 10-year Treasury note yield was at 2.929% , having pulled back from a 10-day high of 2.946% scaled on Monday.

In commodities, Brent crude futures were down 8 cents at $75.30 a barrel. The contract went as low as $73.81, the weakest since May 8, the previous day after a report that the US government had asked Saudi Arabia and other major exporters to increase oil output.