Asia stocks mixed, dollar slips as Fed continues to weigh
SINGAPORE: Asian stocks were mixed on Monday in thin trade, following Wall Street’s declines and the G20’s decision to drop a pledge to avoid trade protectionism, while the Federal Reserve’s less hawkish- than- expected comments continued to weigh on the dollar.
European stocks are set for a subdued start, with financial spreadbetter IG Markets expecting Britain’s FTSE 100 to open little changed and Germany’s DAX to open 0.3 per cent lower.
MSCI’s broadest index of AsiaPacific shares outside Japan added 0.3 per cent.
Hong Kong’s Hang Seng climbed 0.7 per cent. Chinese shares were mixed with the CSI 300 down 0.1 per cent while the Shanghai Composite added 0.1 per cent.
Australian shares closed down 0.36 per cent. South Korea ended the day 0.35 per cent lower. Japan is closed for a holiday.
The MSCI emerging markets index added 0.4 per cent to hit its highest level in more than two years on Monday.
Investor sentiment towards emerging markets, while cooling, remains positive. Emerging market equity funds had their sixth straight week of inflows in the week ending March 15, but the pace slowed.
They had net inflows of US$215 million, compared with nearly US$1 billion the previous week, according to Thomson Reuters data.
On Friday, Wall Street was flat to negative, dragged lower by bank shares that fell along with Treasury yields.
Financial leaders from the world’s biggest economies reiterated their warnings against competitive devaluations and disorderly foreign exchange markets at the meeting in the German town of Baden-Baden over the weekend.
But they failed to agree on a commitment to keep international trade free and open, highlighting a global shift towards protectionism.
On Sunday, German Chancellor Angela Merkel and Japan’s Prime Minister Shinzo Abe defended free trade, calling for a trade deal to be reached quickly between Japan and the European Union and distancing themselves from protectionist rhetoric coming from the Trump administration. — Reuters