Asian stocks set to rise on USA cues; oil higher

USA stock market declines accelerated in afternoon trading, and major US indexes ended near session lows.

The CBOE Volatility index .VIX , the most widely followed barometer of expected near-term stock market volatility, ended above the 15 level in its highest close since April 13.

The Dow dropped 250 points, and the US dollar is falling, while the so-called fear gauge spiked as political drama continues to surround President Trump and the White House.

The ICE U.S. Dollar Index, which gauges the dollar against a basket of six currencies, fell 0.4% to 97.685.

The U.S. stock market early Wednesday was on pace to log its worst daily decline in months, as concerns about President Donald Trump's Federal Bureau of Investigation controversy weighed on investor sentiment.

That was only the latest worry in a tumultuous week at the White House after Trump unexpectedly fired Comey and reportedly disclosed classified information to Russia's foreign minister about a planned Islamic State operation.

At 10:46 a.m. ET (1446 GMT), the Dow Jones Industrial Average was down 234.47 points, or 1.12 percent, at 20,745.28, the S&P 500 was down 24.18 points, or 1.01 percent, at 2,376.49 and the Nasdaq Composite index was down 83.65 points, or 1.36 percent, at 6,086.22.

Both the Dow and S&P 500 fell below their 50-day moving averages for the first time since April 21.

Asian equities retreated overnight, S&P 500 Index futures slipped and haven assets from gold to the yen advanced as the unrelenting pace of developments threatened to derail Trump administration policy prescriptions cheered by Wall Street. The S&P began the session by opening 0.74 percent lower, the largest gap down since March 30, 2009, when the index suffered a 0.84 percent drop at the start of trading.




"We're largely through the earnings season, so political uncertainty is probably going to be the largest source of risk in the next three to six months". The VIX last week closed at 9.77, its lowest close since December 1993.

Those pledges had helped fuel a record-setting post-election rally on Wall Street.

"The only political calibration the Fed has is how much Trumponomics we were going to get that they can't see yet", Neil Dwane, global strategist at Allianz Global Investors, said in an interview with Bloomberg TV.

Prices of bonds, seen as safe-haven assets, rallied, while yields were on track for their biggest daily percentage drops since July. The yen rose 0.9 percent to 112.21 per dollar, after climbing 0.6 percent on Tuesday.

Benchmark 10-year notes were up 1 point in price to yield 2.21 percent.

Oil prices dropped after data showed an increase in US crude inventories, stoking concerns that markets remain oversupplied despite efforts by top producers Saudi Arabia and Russian Federation to extend output cuts.

OIL: Benchmark U.S. crude rose 13 cents to $48.79 per barrel in electronic trading on the New York Mercantile Exchange while Brent crude, used to price worldwide oils, was up 24 cents to $51.89 per barrel in London.

Spot gold added 0.5 percent to $1,236.91 an ounce.

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