Asian shares lower ahead of earnings, Fed meeting
Asian stock markets were lower Tuesday, taking a cue from losses on Wall Street ahead of earnings from major Asian companies and the Federal Reserve’s policy meeting.
Investors are looking ahead to Wednesday when the Federal Reserve ends a two-day meeting at which policymakers will discuss when to raise a key interest rate that has been held near zero for 6 years. After its March meeting, the Fed opened the door to a rate increase this year by no longer saying it would be “patient” in starting to raise its benchmark rate. But weak economic data recently might complicate that picture.
“The Fed will have to acknowledge the weaker data of late when it meets tomorrow,” DBS Bank said in a daily report. “It will be hard to blame either on dock strikes or the weather, given that payrolls dipped in March and capex has been falling since August.”
The Conference Board releases its April index on U.S. consumer confidence on Tuesday. In March, an improving job market drove U.S. consumer confidence higher after a dip in February, a promising sign for the economy as it heads into spring. The U.S. government also releases its estimate of economic growth in the January- March quarter. Gross domestic product is expected to have risen 1 percent, down from 2.2 percent in the previous quarter.
U. S. stocks closed lower on Monday after trading higher in the morning session. The Dow Jones industrial average fell 42.17 points, or 0.2 percent, to close at 18,037.97. The Standard & Poor’s 500 fell 8.77 points, or 0.4 percent, to 2,108.92. The Nasdaq fell 31.84 points, or 0.6 percent, to 5,060.25.
Shanghai retreated 1.13 percent, or 51.18 points, to 4,476.21 while Hong Kong was flat, edging up 9.16 points to 28,442.75. The two indexes have been surging on hopes that China will unveil more monetary easing measures to boost the slowing economy.
“The ( Shanghai) market will become more volatile as the index gets higher,” Jimmy Zuo, a Shenzhen-based trader at Guosen Securities, told Bloomberg News.
“There’s a strong belief that disappointing data and earnings will persuade the government to do more to safeguard the economy.”
Sydney fell 0.57 percent, or 34.2 points, to close at 5,948.5 and Seoul slipped 0.46 percent, or 9.87 points, to 2,147.67.
However, Tokyo added 0.38 percent, or 75.63 points, to 20,058.95 as investors struck an optimistic note ahead of a raft of earnings results by major Japanese firms.
There was little reaction to a decision by Fitch to cut its credit rating on heavily indebted Japan by one notch, citing concerns about its budget after it delayed a sales tax rise originally slated for this year. Gold fetched US$1,201.39 against US$1,185.34 late Monday. In other markets: — Wellington was marginally higher, adding 4.30 points to 5,769.65.
Market heavyweight Fletcher Building was up 0.98 percent at NZ$824 and Spark added 0.18 percent to NZ$2.86.
— Manila closed down 0.90 percent, or 71.50 points, at 7,886.57.
Jollibee Foods fell 2.60 percent to 202.60 pesos while BDO Unibank dropped 3.03 percent to 112 pesos.
— Singapore lost 0.59 percent, or 20.76 points, to 3,495.09.
Property developer Capitaland climbed 0.80 percent to SG$3.79 and oil rig maker Keppel Corp. declined 2.56 percent to SG$8.77.
— Bangkok fell 1.12 percent, or 17.30 points, to 1,531.53.
Kasikorn Bank dropped 2.78 percent to 210.00 baht and supermarket operator Big C Supercenter dipped 2.16 percent to 226.00 baht.
— Jakarta closed flat, edging down 3.29 points to 5,242.16.
Carmaker Astra International fell 1.01 percent to 7,375 rupiah, while lender Bank CIMB Niaga rose 0.73 percent to 690 rupiah.
— Kuala Lumpur slipped 0.24 percent, or 4.52 points, to 1,855.06. AMMB Holdings gained 0.62 percent to 6.46 ringgit while British American Tobacco ended 0.90 percent lower at 65.94 ringgit. Telekom Malaysia fell 0.13 percent to 7.49 ringgit.
—- Mumbai rose 0.81 percent, or 219.39 points, to 27,396.38.
India’s largest private bank ICICI Bank rose 8.02 percent to 326.65 rupees, while fast moving consumer goods major ITC fell 1.92 percent to 337.50 rupees.