Asian market news: shares got off to a slow start on Monday as fading chances for early rate cuts globally soured the mood, though investors are hoping China markets return from holiday with a spring in their step.

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A holiday for U.S. markets also made for thin trading, while the latest surge in tech stocks is set to be tested by results from AI diva Nvidia on Wednesday.

MSCI's broadest index of Asia-Pacific shares outside Japan edged up 0.2 per cent, after bouncing 2 per cent last week.

Japan's Nikkei was flat, having surged more than 4 per cent last week to stop just short of its all-time high.

There was promising news from China where tourism revenues during the Lunar New Year break surged by 47 per cent on a year earlier as more than 61 million rail trips were taken.

The country's central bank skipped a chance to cut rates again on Sunday, likely to limit downward pressure on the yuan, but with deflation looming analysts see plenty of scope for further policy stimulus.

The same cannot be said for the United States following high readings on producer and consumer prices, that saw markets sharply scale back pricing for rate cuts.

Bruce Kasman, global head of economics at JPMorgan, warned the Federal Reserve's favoured measure of core personal consumption inflation could now jump by 0.5 per cent in January. Only a week ago, markets were hoping for a rise of just 0.2 per cent.

"While it is premature to place significant weight on noisy January data, risks have shifted in the direction that core inflation and labour market conditions both surprise the Fed in a hawkish direction in the first half of 2024," Kasman wrote in a note.

"This stall has been expected to delay the start of the developed world easing cycle to midyear, and curb enthusiasm about the overall magnitude of the easing cycle ahead."

Futures have sunk to imply just a 28 per cent chance rates will be cut in May, when it was considered a done deal a couple of weeks ago. Markets have taken out two quarter point rate cuts for this year to imply less than 100 basis points of easing.

HANGING ON NVIDIA

The surprise on inflation means the minutes of the Fed's last policy meeting out this week now look dated, but any talk about the timing of potential cuts will be noted.

There are plenty of Fed speakers out this week to comment on the outlook, with Fed Vice Chair Philip Jefferson and Governor Christopher Waller of particular interest.

The market sea change on rates saw two-year Treasury yields spike to a new 2024 high of 4.72 per cent on Friday before steadying at 4.65 per cent. Treasury futures were little changed on Monday with the cash market closed.

S&P 500 futures were up 0.1 per cent, while Nasdaq futures added 0.2 per cent on hopes Nvidia could somehow beat already stratospheric expectations.

The chipmaker's stock has surged 46 per cent so far this year and accounted for more than a quarter of the S&P 500's gains. There is reason for optimism given that of the 80 per cent of S&P 500 reporting so far, 75 per cent have beaten forecasts.

Goldman Sachs cited profits in the tech sector last week when it raised its year-end S&P 500 index target to 5,200, from 5,100.

"Our upgraded 2024 EPS forecast of $241 - 8 per cent growth - stands above the median top-down strategist forecast of $235," said Goldman. "We expect P/E valuation multiples will remain close to current levels, making earnings growth the primary driver of remaining upside this year."

Higher bond yields were underpinning the dollar at 150.07 yen, though the threat of intervention has so far capped it at 150.88. The euro has also reached its highest so far this year on the yen at 161.95.

The single currency was steady on the dollar at $1.0784, having met resistance just above $1.0800.

The rise in yields has been a burden for non-yielding gold, which was idling at $2,014 an ounce.

Oil prices were softer in early trade as concerns about demand tussled with the threat of supply disruptions in the Middle East.

Brent slipped 32 cents to $83.15 a barrel, while U.S. crude for April fell 33 cents to $78.13 per barrel.