Tokyo — Asian shares were on the defensive on Monday, undermined by the fear that the strength in the US dollar and rising US bond yields since Donald Trump’s election to president could accelerate fund outflows from emerging markets. MSCI’s broadest dollar-based index of Asia-Pacific shares outside Japan dipped 0.1%, staying near four-month lows. In local currency terms, many markets are up slightly. Japan’s Nikkei rose 0.5% to hit a 10-and-a-half-month high thanks to a weaker yen. Trump’s unexpected election victory has led to a major repricing of assets, with investors rushing to buy US stocks and the dollar, while dumping bonds and emerging-market assets. Carrying out even some of Trump’s plans for deregulation and tax cuts would undermine assumptions investors had long held — that the US economy would grow modestly and inflation would remain tame in the foreseeable future. As the expectation grows that the Federal Reserve might have to raise interest rates faster than expected ...
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