November 10, 2017 / 7:18 AM / in 9 days

RPT-GLOBAL MARKETS-Asian stocks slip as U.S. tax doubts snap global winning streak

(Repeats for technical reasons - no change in text)

* Senate Republicans propose 1-year delay in corporate tax cut

* Global shares snap 10-day winning streak

* Oil prices firm on output cut hopes, Saudi tensions

* European shares seen opening almost flat

By Hideyuki Sano

TOKYO, Nov 10 (Reuters) - Asian shares slipped on Friday on uncertainty about U.S. tax reforms after Senate Republicans unveiled a plan that differed from the House of Representatives’ version in several key areas, including a delay in the timing of a corporate tax cut.

European shares are expected to be little changed, with spread-betters looking at an almost flat opening for Britain’s FTSE and Germany’s DAX.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.15 percent. Japan’s Nikkei lost 0.8 percent, slipping off Thursday’s 21-year high after an almost relentless 16-percent rally in the past two months. But the index had a ninth consecutive week of gains.

MSCI’s all-country equity index posted its first daily loss in more than two weeks on Thursday, ending at 10 days its longest winning streak since 2003.

On Wall Street, the S&P 500 lost 0.38 percent while the Nasdaq Composite dropped 0.58 percent on Thursday.

U.S. Republican senators said they want to slash the corporate tax rate in 2019, later than the House’s proposed schedule of 2018, complicating a push for the biggest overhaul of U.S. tax law since the 1980s.

The House was set to vote on its measure next week. But the Senate’s timetable was less clear, with a formal bill yet to be drafted in that chamber, where Republicans have a much smaller majority and a narrower path to approval for any legislation, let alone one as contentious as a tax package.

“Things look fluid, including on when the tax cut deal will be reached,” said Hirokazu Kabeya, chief global strategist at Daiwa Securities.

“I would say a compromise will be reached in the end, and we don’t need to be too pessimistic. But if they indeed decide to delay the tax cut by a year, there is likely to be some disappointment,” he said.

Others said a correction in share markets was due after a strong rally worldwide though to some, fundamentally the prospects for solid global economic growth are expected to support stocks.

“Yesterday the European Commission revised up its economic growth forecast and cut its inflation forecast. And we can find the same story in the world as a whole. Growth is seen higher while inflation will remain tame,” said Shuji Shirota, head of macro economic strategy group at HSBC.

“The goldilocks economy continues while interest rates remain low, creating favourable conditions for stocks,” he added.

The European Commission forecast the euro zone economy will grow at its fastest pace in a decade this year.

In the currency market, the U.S. dollar also faced the head wind from the worries about the tax reform, with the euro firming to $1.1644, extending its rebound from $1.1553, its 3 1/2-month low touched on Tuesday.

The dollar slipped to 113.32 yen, from Monday’s high of 114.735, its highest level since March.

The 10-year U.S. Treasuries yield also briefly fell, though it came back to 2.340 percent, pressured by this week’s government and corporate debt supply.

U.S. junk bonds were sold off, with the price of major junk bond ETF plunging to its lowest level since March.

Oil prices held firm, on course to log their fifth straight week of gains, on hopes of supply cuts by major exporters as well as continuing concern about political developments in Saudi Arabia.

A spokesman for Saudi Arabia’s energy ministry said the kingdom plans to cut crude exports by 120,000 barrels per day in December from November.

U.S. light crude futures traded at $57.04, down 0.2 percent in early Asian trade but still just shy of this week’s more than two-year high of $57.69 a barrel.

Brent futures changed hands at $57.02, down 0.3 percent on the day but up 2.8 percent on the week.

Concerns about the stability of Saudi Arabia, sparked after the purge of 11 princes and arrests of dozen other influential figures since last week, are intensifying.

Sources told Reuters Lebanon believes the country’s former prime minister, Saad al-Hariri, is being held in Saudi Arabia, although Saudi Arabia denied reports he is under house arrest.

Saudi Arabia accused Beirut earlier this week of declaring war against the kingdom, blaming what it describes as aggression by Hezbollah, Lebanese Shi‘ite group backed by its arch-rival Iran. (Editing by Sam Holmes and Richard Borsuk)

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