Stocks Drift in Asia as China Sinks on Trade Angst: Markets Wrap
Stocks in Asia struggled for direction Wednesday, while Chinese shares slumped as concerns lingered over the impact of potential global trade restrictions. The dollar and Treasury yields steadied.
The steepest declines were in Hong Kong and China, with Chinese shares sliding for a third day and extending a bear market, as the yuan continued to weaken. Equity benchmarks in Tokyo ended little changed after swinging between gains and losses, and the yen climbed. A gauge of energy companies on the MSCI Asia Pacific Index of stocks rose as oil consolidated above $70 a barrel following reports the U.S. is pressing allies to halt imports of Iranian crude. European futures signaled a softer open for equities.
Investors focused on the simmering trade tensions are awaiting more clarity from the White House on its plans. President Donald Trump signaled he may take a less confrontational path toward curbing Chinese investments, backing down from earlier reports that the U.S. would bar Chinese money in certain technologies. As traders fret over the immediate outlook they also have doubts about the longer-term path for U.S. rates; the Treasury curve is the flattest in years, stoking fears about the prospect of a recession.
Meanwhile, in China, a deepening sense of unease continued to weigh on markets. The benchmark Shanghai stock index tumbled 20 percent in just five months to enter a bear market. The yuan posted its longest losing streak in four years in Hong Kong.
Elsewhere, the Korean won fell to a seven-month low as emerging currencies remained under pressure. Gold traded at its lowest price this year. Copper extended a drop to its lowest in almost three months amid trade uncertainty.
These are key key events coming up this week:
New Zealand and Indonesia monetary policy decisions on Thursday. U.S. personal spending probably increased in May for a third month, economists forecast ahead of Fridays data. China manufacturing and non-manufacturing PMI are due on Saturday.Here are the main market moves.
Topix index ended virtually flat at the 3 p.m. close in Tokyo. Hong Kongs Hang Seng Index fell 1.1 percent. Shanghai Composite fell 1.3 percent, while the CSI 300 Index of stocks that trade in Shanghai and Shenzhen tumbled 2.1 percent. Kospi index fell 0.1 percent. Australias S&P/ASX 200 Index was steady. Futures on the S&P 500 Index fell 0.2 percent. FTSE 100 futures nudged lower as of 7:04 a.m. in London. The MSCI Asia Pacific Index fell 0.4 percent.
The Bloomberg Dollar Spot Index fell less than 0.1 percent. The Japanese yen rose 0.1 percent to 109.92 per dollar. The euro rose 0.1 percent to $1.1658.
The yield on 10-year Treasuries was little changed at 2.87 percent. Australias 10-year yield fell one basis point to 2.63 percent. Germanys 10-year bund yield was steady at 0.34 percent.
West Texas Intermediate crude rose 0.3 percent to $70.72 a barrel. Gold fell 0.2 percent to $1,256.29 an ounce. LME copper fell 0.4 percent to $6,685.00 per metric ton.Rašyti komentarą