Asian stocks retreat as US political tumult adds to growth worry
TOKYO: Asian stock markets retreated again yesterday, extending a rout that began last week as US political uncertainty exacerbated worries over slowing global economic growth.
Investors were unnerved by the US federal government partial shutdown and President Donald Trump’s hostile stance towards the Federal Reserve chairman.
US Treasury Secretary Steven Mnuchin had also raised market concerns by convening a crisis group amid the pullback in stocks.
S& P 500 emini futures were last down 0.6 per cent, pointing towards a lower start for Wall Street when the US market reopens after Christmas Day, when many of the world’s financial markets were shut.
Markets in Britain, Germany and France will remain closed on Wednesday.
MSCI’s broadest index of AsiaPacific shares outside Japan slipped 0.5 per cent, brushing a two-month low.
The Shanghai Composite Index lost 0.4 per cent while South Korea’s KOSPI shed 1.6 per cent.
Japan’s Nikkei, which slumped 5 per cent the previous day, had a volatile session. It swerved in and out of the red, falling more than 1 per cent to a 20-month-low at one stage, before ending the day with a gain of 0.9 per cent.
“In addition to concerns towards the US economy, the markets are now having to grapple with growing turmoil in the White House which has raised political risk ahead of the yearend,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.
US stocks have dropped sharply in recent weeks on concerns over weaker economic growth. — Reuters