By Swati Pandey
SYDNEY (Reuters) – Asian stocks were a red sea on Monday after a strong US job gets patient expectations, the federal bank will deliver a high surcharge, while the Turkish lira floated near two weeks of setbacks on concerns about independence in the central bank.
The vote was also subdued by US investment bank Morgan Stanley's decision to reduce exposure to global stocks due to concerns about the possibility of political relief to compensate for weaker economic data.
The Dour mood expanded outside Asia with the pan-region Euro Stoxx 50 futures () opening 0.4% lower, while Germany's () and London's () fell 0.5% and 0.3% respectively. E-minis for S & P500 () fell 0.25%.
In a rare case, every market across Asia was red on Monday. MSCI's widest index of Asia-Pacific shares outside Japan () lost 1
Chinese stocks were heavily sold with the blue chip index () down 2.2% and Hong Kong's Hang Seng index () down 1.8%.
South Korea's KOSPI () was 2.1% and Australian stocks about 1.2% to a five-week low.
"We lower our exposure to global stocks to the extent we consider" underweight, "said Morgan Stanley's London bassist Andrew Sheets in a note. The previous area was" neutral. "
Expensive valuations and pressure on earnings were among The reasons for the downgrade, Sheets said, while the bank increased its exposure to emerging markets government bonds and safe government bonds.
Since the beginning of the year, global stocks have generally been bolstered by expectations that central banks will keep interest rates at or near record highs to boost economic growth.
These expectations were tempered by a US work report on Friday, showing that nonfarm wage salaries jumped 224,000 in June, beating forecasts for 160,000, indicating that the world's largest economy still had a fire.
Given the strength shown in the data, investors now expect US Federal Reserve Mayor Jerome Powell to slow down this year's price cuts
Efforts for aggressive Fed easings are already out, with the market now pricing a 27 basis point relief this month, from 33 basis points before payrolls.
Powell will provide further indications of the short-term outlook for monetary policy this week at its biannual testimony to the US Congress.
"Global stocks are undoubtedly expensive, but valuation is driven by lower returns and liquidity, and this only makes this Thursday's speech from the Fed chair Powell so important," said Chris Weston, a strategist at Pepperstone.
"For those who drives dollar positions, gold or US stocks … Powell's testimony is an event risk and one in which we should consider how any reactions will affect our exposures. "
CURRENCY AND GEOPOLITICS
There were some positive news about the long-standing China United States trade war with White House Financial advisor Larry Kudlow confirms that US and China top representatives will meet in the coming week for trade negotiations.
"If the dealers can find a solution to the difficult structural problems that remain between the two sides is another matter , and Kudlow warned that it was not a timeline to reach an agreement, said national Australian bank strategist Rodrigo Catril.
In foreign exchange markets, the act of the Turkish lira
President Tayyip Erdogan drew Cetinkaya to deny the government's repeated demand for interest rate cut, and merely put differences between them over the timing of interest rate cuts to revive the recession.
The (), which measures the greenback against a basket of major currencies, was a shade weaker at 97,245 after climbing to a 2-1 / 2-week peak at 97,443 on Friday.
The euro () was a tad lower at $ 1.1224, not far from a 2-1 / 2 week low of $ 1,1205 affected Friday.
The Australian Dollar
"So far, tensions in the US and Iran have not had a significant impact on markets, but if tensions are escalating, it may be a different story," said NAB's Catril.  In commodity markets, oil prices rose with Brent Raw futures (), the international reference price for oil prices, up 5 cents at $ 64.28 a barrel, while increasing 4 cents to $ 57.55