Asian mar­kets slip as Fed holds

The Myanmar Times - - International Business -

ASIAN mar­kets dropped yes­ter­day, pick­ing up where they left off af­ter last week’s Fed-in­spired rally ran out of steam.

Af­ter a burst of en­thu­si­asm on the back of the US cen­tral bank’s de­ci­sion to keep in­ter­est rates on hold for a lit­tle longer, screens were red across the world – with the pace of de­cline sharply quick­ened.

The stay of ex­e­cu­tion for easy money served to bol­ster the Ja­panese yen, knock­ing the stuff­ing out of Tokyo which ended down 1.25 per­cent.

A stronger yen tends to make Ja­panese stocks less de­sir­able.

Big mar­kets in Asia fol­lowed suit, with Hong Kong and Shang­hai also shed­ding more than 1pc.

Oil had ap­peared to of­fer some hope, af­ter los­ing more than 3pc on Septem­ber 23, but could not hold onto its gains as the day wore on.

“Oil spot prices will have a big in­flu­ence on where eq­ui­ties mar­kets are go­ing to trade for the early part of the week,” said An­gus Ni­chol­son, a Mel­bourne-based an­a­lyst at IG Ltd.

Two years of over­sup­ply and OPEC’s fail­ure to forge any kind of con­sen­sus on how to deal with it have left ob­servers scep­ti­cal of any change in di­rec­tion at the meet­ing in Al­ge­ria this week.

On eq­ui­ties mar­kets, Hong Kong spent the day in neg­a­tive ter­ri­tory shed­ding 1.6pc to close at 23,317.92.

The news was just as bad in Shang­hai, where the bench­mark Shang­hai Com­pos­ite In­dex dropped 1.8pc to 2980.43.

Syd­ney closed flat, while Tai­wan gave up 1 per­cent and Seoul slipped 0.3pc.

The yen was higher yes­ter­day, with cur­rency traders ap­par­ently em­bold­ened by last week’s Bank of Ja­pan move to tar­get 10-year gov­ern­ment bonds in its lat­est bid to fuel in­fla­tion.

“The Bank of Ja­pan has lost con­trol of the yen,” said Matthew Sher­wood, head of in­vest­ment strat­egy in Syd­ney at Per­pet­ual Ltd.

“The only hope for Ja­pan and the yen may be an ag­gres­sive Fed, but this is look­ing next to im­pos­si­ble de­spite an ap­par­ent split in the Fed Open Mar­ket Com­mit­tee.”

Oil traders pushed both bench­marks mod­er­ately higher in early Asian trade, but re­treated later.

West Texas In­ter­me­di­ate for Novem­ber de­liv­ery was flat at US$44.53 while Brent crude sat at $45.89.

Newspapers in English

Newspapers from Myanmar

© PressReader. All rights reserved.