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GLOBAL MARKETS-Asia shares down on caution over US tax reform plan, sterling falls

From Reuters - November 12, 2017

TOKYO (Reuters) - Asian shares stepped back in cautious early trade on Monday as investors look to see whether U.S. Republicans can hammer a tax reform deal quickly, while the British pound fell on growing doubts over Prime Minister Theresa Mays leadership.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dipped 0.15 percent while Tokyo's benchmark Nikkei .N225 dropped 0.7 percent.

By Fridays close on Wall Street, the S&P 500 index had snapped an eight-week winning streak as investors took profits after U.S. Senate Republicans had unveiled a new tax plan that differed from the House of Representatives version.

There are few signs of a compromise yet, with the head of the House of Representatives tax-writing committee opposing a proposal from Senate Republicans that would hike taxes for some middle class Americans.

All eyes are on what the Senate and the House of Representatives will do on their tax bills, said Nobuhiko Kuramochi, chief strategist at Mizuho Securities.

That there is debate is not surprising at all. Still, it is an uphill moment for markets, he said.

In the currency market, the dollar also came under pressure from the uncertainty over the fate of the tax cut plans.

The euro EUR= traded at $1.1647, down slightly after having made its first weekly gain in four weeks last week.

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