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Bitcoin extends sweeping rally; eyes $100K

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Tariff worries weigh on euro

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Asian chip stocks struggle on clamp-down fears

By Ankur Banerjee

SINGAPORE, Nov 12 (Reuters) - Asian stocks eased while

the dollar held at four-month highs on Tuesday, though all the

excitement was centred on bitcoin as it soared to a record peak

underpinned by investor bets on assets that are likely to

benefit from Donald Trump's election win.

Investors anticipate Trump's second four-year term in office

will bring equities-boosting tax cuts and looser regulations,

lifting the world's biggest and best-known cryptocurrency,

bitcoin, to an all-time high of $89,637.

But the threat of possible tariffs from the new White House

administration has put the euro under pressure, with

the single currency touching near seven-month lows of $1.0687

overnight. It was last at $1.0658 in Asian hours on Tuesday.

The dollar on the other hand is expected to benefit from

some of the policies that will likely keep U.S. interest rates

relatively higher for longer. The dollar index, which

measures the greenback versus six peers, was at 105.57, just shy

of the 4-month high hit on Monday.

Vasu Menon, managing director of investment strategy at

OCBC, said the decisive win by Trump and the Republican party

removes the overhang of an unclear or a contested U.S. election

outcome.

"The medium-term outlook could become cloudier if Trump

pursues aggressive tariff hikes ... This could fuel inflation

eventually and stop the Fed from cutting rates. Tariffs also

carry the risk of retaliation from the major trading partners."

"But this is a story for another time and Trump's victory

has unleashed the animal spirit in markets for now," Menon said.

Data provider DDHQ projected on Monday that Trump's

Republican Party had won a majority in the U.S. House of

Representatives, signalling a majority for Republicans in both

chambers of Congress.

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

was down 1%, with Taiwan shares sliding

2% and South Korean stocks 1% lower.

Chip stocks in the region have been reeling this week after

Reuters reported that the U.S. ordered Taiwan Semiconductor

Manufacturing Co ( TSM ) to halt shipments of advanced chips

to Chinese customers that are often used in AI applications.

Japan's Nikkei was an outlier in the region and was

up 0.5% on a weak yen, which was hovering close to

more than three-month lows and last fetched 153.93 per dollar.

Overnight, Wall Street's main indexes notched record high

closes, with Tesla gaining around 9% after touching $1

trillion in market value on Friday on bets that the automaker

would benefit from CEO Elon Musk's backing of Trump.

Trump's victory and the election of pro-crypto candidates to

Congress have supercharged a bitcoin rally to record highs

closer to 90,000, and targeting $100,000 next. It was last at

$88,709.

"After such a performance, one could ask whether the Trump

trades are already played out? Our take is 'No', as we think

these trades still have plenty more legs," said Manish Kabra,

lead U.S. equities & multi-asset strategist at Societe Generale

in a note.

Meanwhile, Chinese shares inched higher, while Hong Kong

stocks slid 1%. Sentiment remained largely downbeat after

Beijing's latest stimulus package failed to deliver the direct

spending aimed at consumers that investors have been expecting.

On the macro side, investor focus will be on U.S. consumer

price inflation data on Wednesday, with a parade of Federal

Reserve speakers also due to speak this week, including Fed

Chair Jerome Powell on Thursday.

Markets are pricing in 87% chance of the Fed cutting rates

in December by 25 basis points.

In commodities, oil prices were little changed in early

trading as China's stimulus plan and oversupply concerns took

the wind out of markets in prior sessions.

Brent crude futures was at $71.88 a barrel, up 0.06%

while U.S. West Texas Intermediate crude futures inched

0.09% higher to $68.10 a barrel.

Spot gold was steady in Asian hours at $2,624 per

ounce after touching its lowest level in a month on Monday.