Asian shares rose after tracking a rally on Wall Street which was spurred by gains that were capped by investors' nervousness over the Beijing drive to reform credit and the implications of tighter U.S. monetary policy.
Chung Seung-jae, market analyst for Mirae Asset Securities said, "Investors are moving more cautiously ahead of the earnings season. The market is also still in the process of gauging whether strength in the U.S. job data last week was a good thing or a bad thing."
"Investors are still unsure whether signs of economic improvement in the U.S. are better for the market than the premature reduction of Fed stimulus," Chung added.
Senior market economist for Sumitomo Mitsui Trust Bank Ayako Sera said, "It is emerging market shares, rather than U.S. shares, that have taken the brunt of a likely reduction in the Fed's asset purchases. If U.S. bond yields are higher, investors do not need to go to emerging market for yields. We are going to see a tug of war between strong U.S. shares and softer emerging economy shares. The ultimate question is whether tighter U.S. policy will damage emerging economies to the extent that it will hurt global growth."
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