* Asian shares lack direction after flat end for Wall St
* Dollar edges back as markets push out first Fed hike
* Investors wary of China-Japan tensions over air zone
By Wayne Cole
SYDNEY, Nov 27 Asian share markets got off to a
stuttering start on Wednesday following an uninspiring
performance by Wall Street, while a dip in the dollar against
the yen could prompt profit-taking on Japanese stocks into
Nikkei futures flagged a further modest pullback
from the six-month peak touched on Monday. Conviction
was also lacking elsewhere, with MSCI's broadest index of
Asia-Pacific shares outside Japan 0.1 percent
In truth there was no clear theme running through markets,
except perhaps for a reluctance to get involved ahead of the
U.S. Thanksgiving holiday on Thursday and next week's payrolls
Wall Street had faded late on Tuesday after upbeat U.S. data
on home building and house prices were offset by a disappointing
reading on consumer confidence.
The Dow Jones industrial average shed its early gains
to end flat, while the S&P 500 Index eked out a 0.01
The Nasdaq managed to outperform thanks to gains in
big-cap technology stocks and finished above 4,000 for the first
time since the dot-com bubble burst in 2000.
Adding to the cautious mood was an escalation of political
tensions in parts of Asia as the White House has called China's
demands that airlines inform Beijing when flying over disputed
islands in the East China Sea "unnecessarily inflammatory."
Two unarmed U.S. B-52 bombers on a training mission flew
over disputed islands in the East China Sea without informing
Beijing, Pentagon officials said on Tuesday.
LOW FOR LONGER
In debt markets it was notable that investors continue to
push out the date when the Federal Reserve might first raise
official rates, proof the central bank has succeeded in
divorcing tapering from tightening.
Eurodollar and Fed fund futures extended
their three-month-old rally with many contracts reaching new
highs. The market no longer has a first hike priced in until the
very end of 2015, while before the Fed's September decision not
to taper, it had been wagering on late 2014.
That sea change has in turn tempered the rise in longer-term
rates with yields on 10-year Treasury paper slipping to 2.71
percent from a peak of 2.84 percent last week.
It might also be one reason the U.S. dollar is struggling
against some of its major counterparts. The euro bounced half a
cent on Tuesday to reach $1.3575 and so test major chart
resistance in the $1.3577/3589 zone.
The euro's gains came even as a who's who of officials at
the European Central Bank opened the door to more policy easing
including a negative deposit rate.
The dollar has also lost altitude against sterling
and the Swiss franc over the last couple of weeks.
In contrast the dollar has fared much better against the
yen, thanks in part to the Bank of Japan's continued commitment
to its massive asset-buying campaign. On Wednesday, the dollar
was holding at 101.26 yen just off the recent six-month
peak around 101.91.
In commodities, U.S. crude oil was pressured after industry
group American Petroleum Institute (API) reported a 6.9 million
barrel rise in crude oil inventories, far higher than the
600,000-barrel build anticipated by analysts.
Nymex crude eased 13 cents to $93.55 a barrel,
leaving it not far from five-month lows.
Brent crude oil futures was steadier at $111.04 a
barrel as investors concluded that a deal between Iran and world
powers would bring no immediate increase in crude supplies.