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Asian stock markets : https://tmsnrt.rs/2zpUAr4

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Bitcoin surges as Trump talks of crypto reserve

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Markets still unsure if US tariffs will go ahead

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Nikkei rallies 1.1%, S&P 500 futures up 0.1%

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Euro edges up on hopes for progress on Ukraine-Russia deal

By Wayne Cole

SYDNEY, March 3 (Reuters) - Asian share markets dithered

on Monday as the threat of imminent tariffs lurked in the

background, while bitcoin surged on news it would be included in

a new U.S. strategic reserve of cryptocurrencies.

U.S. President Donald Trump on social media announced five

digital assets he expected to include in a new reserve,

including bitcoin, ether, XRP, solana

and cardano.

Bitcoin, the world's largest cryptocurrency by market value,

shot up more than 11% to $94,110, while ether, the

second-largest cryptocurrency, climbed 14% to $2,528.

MSCI's broadest index of Asia-Pacific shares outside Japan

was flat, though Japan's Nikkei rose

1.1%, helped by a softer yen.

S&P 500 futures and Nasdaq futures were both

up 0.1%, having staged a late rally on Friday after a week of

heavy losses.

Geopolitical uncertainty lingered as European leaders agreed to

draw up a Ukraine peace plan to take to the United States,

following President Volodymyr Zelenskiy's clash with Trump in

the Oval Office.

Worries about the health of U.S. economy had also been fanned by

a string of soft data that had seen the closely watched Atlanta

Fed GDPNow tracker swing to an annualised -1.5%, from +2.3%,

sparking talk of a possible recession.

Those fears were fanned on Sunday when U.S. Commerce Secretary

Howard Lutnick said tariffs on Canada and Mexico will go into

effect on Tuesday, but that Trump would determine whether to

stick with the planned 25% level.

An extra 10% levy on Chinese imports is also due to come

into effect this week, just as the country's National People's

Congress opens its third annual session on Wednesday where

stimulus measures and possible reprisals against the U.S. could

be announced.

"As with other Trump tariff announcements so far, it's hard

to know if this is a bluff or a genuine turn in policy," said

JPMorgan economist Michael Feroli.

"However, if it were to be realized it would create a

significant new headwind to economic activity, as well as an

upside support to consumer prices."

PAYROLLS LOOM

All of this raises the stakes for the January U.S. payrolls

report due on Friday, where a weak outcome would fuel market

bets the Federal Reserve might have to cut interest rates three

times this year.

Fed fund futures now imply 69 basis points of easing

by December, compared with 46 basis points a week ago. Yields on

10-year Treasuries extended their rally with a drop

to 4.220%, leaving them down 35 basis points in February, the

largest monthly decline since late 2023.

Fed Chair Jerome Powell is due to talk on the economic

outlook on Friday, just a few hours after the jobs report, and

at least seven other officials will appear this week.

Across the Atlantic, the European Central Bank is widely

expected to cut its rates by 25 basis points to 2.50% on

Thursday following a run of weak data, and a move under 2% is

expected by year-end.

In currency markets, the euro edged up 0.4% to $1.0416

on hopes for progress in a Russian-Ukrainian peace deal, having

been as low as $1.0360 on Friday.

The dollar held at 1.4495 Canadian dollar, after

rising 1.7% last week, and at 20.5010 Mexican pesos.

It was firmer on the Japanese yen at 150.98 yen,

while the dollar index was down slightly at 107.280.

Gold prices inched up 0.5% to $2,873 an ounce, having

dropped around 3% last week.

Oil bounced a little, having slid last week amid speculation

the U.S. could ease sanctions on Russian output, while the risk

of a global trade war could hit demand for energy.

Brent futures rose 35 cents to $73.16 a barrel,

while U.S. crude futures added 30 cents to $70.05 per

barrel.

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