It was "buy the rumour, sell the fact" as Australian stocks retreated despite US President-elect Joe Biden tweeting demands for $US2000 ($2600) stimulus cheques and as China's latest economic data showed the recovery in our most important trade partner continues to gather pace.

The collective shrug underscores the growing tug of war between the stock-boosting prospect of revved-up US growth and the valuation dampening threat of a rise in bond yields as jitters about resurgent inflation simmer.