SHANGHAI (Reuters) – Equity markets in Asia faltered on Wednesday, amid losses in South Korea and worries that China has put any further stimulus on hold as the economy shows signs of regaining its footing.

MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.5 percent lower, erasing early gains in the wake of record closing highs on Wall Street overnight.

The biggest regional loser was South Korea’s KOSPI, which was down 1.3 percent. Investors shrugged off the government’s proposed supplementary budget aimed in part at supporting exports, and worried after chipmaker Texas Instruments said it expects a slowdown in demand for microchips could last a few more quarters.

Shares of Samsung Electronics were down 2.1 percent.

“Texas Instruments has published some good results but has poured a little bit of cold water on what’s going to happen in the second half of the year,” said Frank Benzimra, head of Asia equity strategy at Societe Generale.

Chinese equities also dropped after early gains, pushing the blue-chip CSI300 index down 0.9 percent and extending losses for the week driven by concerns that Beijing may slow the pace of policy easing following stronger-than-expected first-quarter economic growth.

China’s central bank is likely to pause to assess economic conditions before making any further moves to ease lenders’ reserve requirements, after the growth data reduced the urgency for action, policy insiders said.

On Wednesday, not all Asian markets were down. Australian shares jumped as much as 1.1 percent to a more-than-11-year high after a sharp slowdown in Australian inflation raised the likelihood of an interest rate cut.

Annual CPI inflation in Australia fell to 1.3 percent in the March quarter, from 1.8 percent in the previous period, the lowest since 2016.

Japan’s Nikkei stock index was down 0.6 percent.

The mixed day in Asia came after upbeat earnings from Coca-Cola, Twitter, United Technologies and Lockheed Martin helped the Nasdaq and S&P 500 indexes reach record closing highs on Wall Street overnight.

The Dow Jones Industrial Average rose 0.52 percent to 26,647.97, the S&P 500 gained 0.91 percent to 2,934.31 and the Nasdaq Composite added 1.35 percent to 8,123.25.

Analysts said that alongside better-than-feared corporate earnings, a more supportive policy environment has helped to boost risk appetites.

“The Fed has been joined in its dovish tilt by major central banks across the globe … the tilt globally reflects genuine concern not to allow individual countries and the globe to tip into recession. That risk has receded,” Greg McKenna, strategist at McKenna Macro in Australia, said in a note to clients.

But after rising early on Wednesday, S&P 500 e-mini stock futures were down 0.14 percent at 2,933.75.

Equity market gains had been bolstered on Tuesday by rising energy shares after Brent crude, the global benchmark, hit its highest level since Nov. 1.

Oil prices surged after the United States ended six months of waivers that allowed Iran’s eight biggest buyers, most of them in Asia, to continue importing limited volumes of Iranian oil.

Gulf OPEC members said that rather than offset any shortfall resulting from the U.S. decision on waivers, they would raise output only if there was demand.

On Wednesday, Brent gave up some gains, trading down 0.54 percent at $74.11 per barrel. U.S. crude dipped 0.57 to $65.92 a barrel.

STEEPER YIELD CURVE

U.S. Treasury yields declined alongside most Asian equities. Benchmark 10-year Treasury notes yielded 2.5596 percent compared with a U.S. close of 2.57 percent on Tuesday, while the two-year yield, slipped to 2.3496 percent, compared with a U.S. close of 2.364 percent.

While U.S. Treasury yields ticked lower, a steepening of the U.S. yield curve indicated a persistent bullish outlook for the U.S. economy.

The spread between two- and 10-year Treasury note yields widened to as much as 21.5 basis points on Wednesday morning, a new high for the year. It last stood at 20.8 basis points.

The yield curve steepens when longer-dated yields rise faster than shorter-dated yields, suggesting bullish investor sentiment.

The U.S. dollar index, which tracks the greenback against a basket of six major rivals, gained 0.04 percent to 97.676, near a 22-month high, following strong U.S. housing data.

The dollar was 0.06 percent weaker against the yen at 111.79, while the euro dropped 0.1 percent to buy $1.1211.

Spot gold fell about 0.2 percent as the dollar strengthened, with one ounce fetching $1,269.36. [GOL/]