Most Asian stocks down as policy fears return
EXPECTATIONS the US will hike interest rates and the EU will also tighten monetary policy dragged most Asian and European markets lower yesterday, but Tokyo chalked up a third-straight gain as a weaker yen helped exporters.
Investors were given a lead by their US counterparts after comments from top Federal Reserve officials fanned speculation it will lift borrowing costs by the end of the year.
Talk of an increase returned after data last week showed US factory activity rebounded in September, while trading floors gear up ahead of a crucial jobs report tomorrow.
Bloomberg also cited unnamed European Central Bank officials as saying there was an “informal consensus” that it should gradually scale back its bond-buying program in steps of 10 billion euros.
Japan’s exporters were lifted by the weaker yen, sending the Nikkei stock index to end up 0.5 percent, extending a rally to three straight days.
Hong Kong posted a third gain, adding 0.4pc, with the Hang Seng buoyed by recent upbeat China data and the impending opening of a linkup with the Shenzhen stock exchange that could see fresh funds flood in.
But most other Asian markets struggled. Sydney fell 0.6pc, Seoul lost 0.1pc, Manila tumbled 1.2pc and Wellington was off 1.1pc. Singapore was flat.
The stronger dollar also sent gold tumbling almost $39 to $1270, its lowest levels since mid-June. –