Asian Stock Markets prepare to guard against Inflation

Asian stocks opened lower on Jan 8 after Wall Street ended its winning streak, as investors awaited U.S. inflation data and a corporate reporting season in which good results are required to justify high stock valuations. Geopolitical tensions were also on the rise, with disruptions in the Red Sea raising oil prices and shipping costs in Europe, and Israel's conflict with Hamas threatening to spill over into Lebanon.

More encouraging news came from Washington, where congressional leaders agreed on a $1.6 trillion spending package aimed at avoiding a partial government shutdown. Early trading was cautious, with MSCI's broadest index of Asia-Pacific shares outside Japan barely changing after falling 2.5 percent the previous week.

The Nikkei in Japan was closed for a holiday, but futures were trading higher at 33,490, compared to Friday's cash close of 33,377. The index has been supported by a drop in the yen as the dollar has recovered. The S&P 500 and Nasdaq futures were both up 0.1% in early trade.

The S&P 500 fell 1.5% last week, snapping a nine-week winning streak that had been the longest since 1989. Because of the index's 24% gain last year, valuations appear a little stretched, so much is riding on the results season. JPMorgan Chase and Citigroup, among others, begin the reporting season on Friday, with high hopes for positive results.