Asian stocks edged down as the dollar rose

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An electronic stock quote board is displayed in a conference room in Tokyo, Japan on November 1, 2021. REUTERS / Issei Kato

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HONG KONG, Nov. 25 (Reuters) – Asian stocks wobbled lower on Thursday, penalized by the US dollar which continued to climb as investors bet on a faster interest rate hike in the United States than in other major economies like Japan and the euro zone.

The largest MSCI Asia-Pacific stock index outside of Japan (.MIAPJ0000PUS) fell 0.18% to a six-week low, after posting a slight decline in each of the past six trading sessions . Japan’s Nikkei (.N225) rose 0.8%.

There were slight drops in all areas. Australia (.AXJO) lost 0.1%, Hong Kong (.HSI) lost 0.35% and Chinese blue chips (.CSI300) lost 0.3%.

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Notably in Hong Kong, shares of Kaisa Group Holdings Ltd (1638.HK) rose as much as 24% when they returned to trading, after the ailing Chinese developer said it was offering bondholders the possibility of exchanging existing bonds for new bonds with an extended life. maturity, to improve financial stability. Read more

In general terms, “when it comes to regional equity allocation, we are watching the US dollar hitting new highs and it’s a headwind for emerging market equities,” said Fook-Hien Yap, strategist in senior investment at Standard Chartered Bank. management.

The dollar is trading near its nearly five-year high against the Japanese currency at 115.3 yen, and nearly 18 months against the euro which was at $ 1.1206.

Supporting the greenback, several policymakers at the US Federal Reserve have said they would be willing to accelerate the reduction of the central bank’s bond purchase program if the high inflation rate continues, and to increase more quickly. interest rates, according to the Fed minutes. 2-3 political meeting showed. Read more

“The market is now anticipating more than two hikes next year, but we think it’s too aggressive. We are only looking for about a hike next year,” Yap said.

Those expectations pushed US Treasury yields higher, albeit inconsistently, with benchmark 10-year bonds last yielding 1.6427%, climbing to 1.6930% on Wednesday.

US Treasuries will not be traded Thursday due to the Thanksgiving holiday. The US stock exchanges will also be closed and will have a shortened session on Friday.

Overnight, Wall Street finished higher and re-testing records as tech stocks rebounded from a massive selloff earlier this week.

In other central bank news, the Bank of Korea raised its key interest rate (KROCRT = ECI) by 25 basis points on Thursday, as widely expected, as concerns over rising household debt and inflation have offset uncertainty surrounding a resurgence of COVID-19 cases.

Oil prices edged up after a few turbulent days in which the United States announced it would release millions of barrels of oil from strategic reserves in coordination with China, India, South Korea, Japan and Britain in an attempt to cool oil prices after calls to OPEC + to pump more have gone unheeded. However, investors questioned the effectiveness of the program, leading to price gains.

Brent crude was at $ 82.53 a barrel, up 0.33%, while US crude was at $ 7,856, up 0.2%.

Spot gold rose 0.17% to 1,791 an ounce.

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Reporting by Alun John; Editing by Christopher Cushing

Our standards: Thomson Reuters Trust Principles.


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