Asian markets rally, yuan edges up after US gains

Asian markets rose on Monday after a healthy lead from Wall Street as positive US jobs data trumped fresh trade war threats, while the yuan extended a recovery after the Chinese central bank moved to support the unit.

Hong Kong led gains as the week got off to an upbeat start, with dealers tracking their New York and European counterparts following recent painful losses.

Data on Friday showed that while the US economy saw a slowdown in jobs creation in July, the pace of hiring remained strong over the past three months.


The report also showed wage growth remained tepid, helping temper worries about an overheating economy.

The result provided some much-needed cheer to markets, which managed to brush off a warning from Beijing that it would impose new tariffs on $60 billion worth of US goods if Washington pushes ahead with levies on $200 billion of Chinese imports.


Despite reports that unofficial talks have been held between the two sides, trade tensions continue to rise with a top White House advisor calling China a bad bet and saying its economy — the world’s second biggest — was struggling.

Still, equity traders were in a buying mood Monday. Hong Kong piled on more than one percent while Shanghai added 0.2 percent and Tokyo went into the break 0.5 percent higher.

Sydney rose 0.7 percent, Singapore jumped more than one percent and Taipei was 0.3 percent stronger. Jakarta climbed 0.7 percent despite an earthquake that rattled the island of Lombok, killing dozens of people.

– Pound struggles –
Support also came from the People’s Bank of China decision late Friday to unveil measures making it harder to bet against the yuan, which has suffered steep losses the past two months.

The currency, which is around lows not seen for more than a year, bounced back soon after the announcement and it extended the gains Monday.

The bank’s measure was similar to a move when the currency went into freefall following a devaluation three years ago that rattled global markets.

However, analysts were lukewarm on the move with some saying it indicated Chinese leaders were growing increasingly worried about the unit’s depreciation.

“The yuan kept falling when China did this last time in 2015, so I don’t think the PBoC’s move will significantly change the market tone,” Hao Hong, chief strategist at Bocom International Holdings, told Bloomberg News.

“No matter what happened over the weekend, the weakness in Chinese stocks may continue. The trade war is nowhere near its end and China’s economy is slowing down, so why would the trend reverse?”

In another forex trading, the pound was fighting to recover from Friday’s sell-off that came after Bank of England boss Mark Carney warned the chances of leaving the EU without a proper deal was “uncomfortably high” and “highly undesirable”.

While he said such a situation was still “unlikely” compared with other outcomes, the comments come as leaders on both sides are struggling to reach a compromise with just months to go before Britain is due to formally exit.

The remarks sent sterling tumbling, with an interest rate hike last week unable to provide any support.

Key figures at 0300 GMT

Tokyo – Nikkei 225: UP 0.5 percent at 22,626.56 (break)

Hong Kong – Hang Seng: UP 1.2 percent at 28,008.62

Shanghai – Composite: UP 0.2 percent at 2,745.04

Euro/dollar: DOWN at $1.1563 from $1.1567 at 2100 GMT on Friday

Pound/dollar: DOWN at $1.2996 from $1.3005

Dollar/yen: DOWN at 111.20 yen from 111.25 yen

Oil – West Texas Intermediate: UP 18 cents at $68.67

Oil – Brent Crude: UP 15 cents at $73.36 per barrel

New York – Dow Jones: UP 0.6 percent to 25,462.58 (close)

London – FTSE 100: UP 1.1 percent at 7,659.10 (close)

source: business.inquirer.net

Most Asian markets rise as 2018 rally extends

The equity rally that has kicked off 2018 continued on Friday, with Asian markets picking up the baton from another set of records on Wall Street.

Dealers are now turning their attention to the release later in the day of key US jobs data, which is expected to show the world’s top economy continuing to improve.

A forecast-smashing reading Thursday on private take-ups boosted optimism, which had already been bolstered by US tax cuts, healthy corporate profits and strong manufacturing figures from around the world.

Global markets powered ahead in 2017 as economies showed long-running improvements after years of faltering.

Greg McKenna, chief market strategist at AxiTrader, said in a note that data from the manufacturing and services sectors “suggests economic strength across the globe remains robust”.

He noted that an index of world factory activity was at its highest level in seven years.

On Wall Street, the Dow ended above 25,000 for the first time, leading records across Wall Street.

In Tokyo, the Nikkei ended up 0.9 percent at a 26-year high following its more than three percent jump Thursday, while Sydney added 0.7 percent.

Seoul rose 1.3 percent, with dealers buoyed by news that North Korea had accepted the South’s offer of talks next week, further easing geopolitical tensions in the region.

Hong Kong gained 0.3 percent to chalk up a ninth-straight gain, while Shanghai closed 0.2 percent higher but Singapore eased 0.2 percent.

Pause in oil?

While oil prices inched down in Asia, they remain elevated after recent rises to around three-year highs thanks to Middle East tensions, while the US sees stockpiles fall as it is hit by a severe cold snap.

The latest gains have given impetus to petroleum-linked firms, sending them rallying this week. In Hong Kong, Sinopec was up more than one percent while CNOOC and PetroChina were also higher. Woodside Petroleum in Sydney was up along with Santos, though Tokyo-listed Inpex eased.

However, Ric Spooner, a Sydney-based analyst at CMC Markets, told Bloomberg News: “There’s been a one-way, very steep and uninterrupted rally off the last minor low in mid-December near $56, so it won’t be surprising to see a pause here.”

On forex markets, the dollar rose slightly against the euro, but the single currency remains buoyant with the eurozone continuing to improve, which raises the chances of a reduction in the region’s massive stimulus programme, bringing monetary policy in line with the Federal Reserve.

McKenna added: “It’s again the story of a weaker US dollar as the fact its data is solid and improving is lost on traders focused on expectations that the EU strength will drive the European Central Bank to chase the Fed, and that synchronised global growth will, in fact, drag most central banks along the tightening path.”

In early European trade, London was flat, Paris rose 0.3 percent and Frankfurt added 0.4 percent.

source: business.inquirer.net

Asian markets suffer as US-North Korea tension escalates anew

Asian markets fell again Wednesday as nervous traders shifted toward safe havens on concerns about North Korea’s latest saber-rattling, while technology firms suffered another torrid day of selling.

Washington confirmed Tuesday that Pyongyang’s latest rocket test was of a missile capable of reaching the United States, ratcheting up pressure in an already tense crisis on the Korean peninsula.

Dealers are now awaiting the next development after Russia and China issued a joint appeal to ease tensions while the United Nations Security Council will hold an emergency meeting later in the day.

The test came just as the US was preparing to celebrate Independence Day and days before a G20 summit, where it will likely top the agenda.

It was the latest provocation by North Korean leader Kim Jong-Un who is determined to develop a nuclear weapons program he says is needed to ward off invasion.

South Korea and the US on Wednesday launched a barrage of missiles simulating a precision strike against Pyongyang, in response to the provocation.

“Traders and investors may be wondering what reaction this latest missile test will get,” said Greg McKenna, chief market strategist at AxiTrader.

With caution flowing through trading floors, markets sank into negative territory.

Tokyo ended the morning 0.5 percent lower with the yen, considered a safe bet in times of turmoil and uncertainty, strengthening against the dollar which hurt Japan’s exporters.

Hong Kong slipped 0.1 percent a day after diving 1.5 percent, while Shanghai shed 0.2 percent. Sydney lost 0.3 percent, Singapore eased 0.1 percent and was marginally lower.

Wellington and Taipei were also in the red.

Traders were given few leads with European markets slightly down and Wall Street closed for the July 4 holiday.

Tech firms were again suffering as global central banks consider tightening monetary policy.

The sector has been a huge beneficiary of the years of cheap borrowing from lenders, sending their stock prices soaring but the prospect of an end to such largesse has led to profit-taking.

Hong Kong-listed Tencent extended Tuesday’s more than four percent loss, while AAC Technologies also retreated and Sony slipped in Tokyo.

However, energy companies continued to benefit from the recovery in oil prices although the black gold, which is up about 10 percent since hitting recent lows in mid-June, dipped slightly Wednesday in Asia.

Investors are awaiting the release Wednesday of minutes from the Federal Reserve’s June policy meeting and key US jobs data Friday. JPV

source: business.inquirer.net

Asian markets lower, rattled by rising tensions in Koreas

SEOUL, South Korea — Asian stocks were lower on Friday as investors fretted over rising geopolitical tensions and the situation on the Korean Peninsula. Many markets were closed for public holidays.

KEEPING SCORE: Tokyo’s Nikkei 225 finished 0.5 percent lower at 18,335.63 and South Korea’s Kospi slipped 0.6 percent to 2,134.88. The Shanghai Composite index dropped 0.9 percent to 3,246.07. Markets in Hong Kong, Singapore and other Southeast Asian countries were closed.

NORTH KOREA: Analysts said investors were seeking safe havens on concern North Korea may be planning a nuclear test. As it prepares for the 105th anniversary of the birth of its founder Kim Il Sung on Saturday, North Korean has intensified its rhetoric, warning of strong retaliation against any aggression as U.S.-South Korea hold military exercises.

ANALYST’S VIEWPOINT: “Geopolitics seemed to dominate over the past week with the ramifications of the U.S.’ missile strike on Syria still reverberating and tensions around North Korea steadily building,” Shane Oliver, chief economist at AMP Capital, said in a commentary. “The issues around Syria are likely to settle down assuming U.S. involvement does not escalate, but North Korea is more risky.”

WALL STREET: U.S. stocks finished lower for the third straight day on Thursday as energy stocks led the decline. The Standard & Poor’s 500 index slid 0.7 percent to 2,328.95. The Dow Jones industrial average fell 0.7 percent to 20,453.25. The Nasdaq composite index lost 0.5 percent to 5,805.15. U.S. markets will be closed Friday for the Good Friday holiday.

OIL: On Friday, the New York Mercantile Exchange and the London Metal Exchange were closed. On Thursday, benchmark U.S. crude rose 7 cents to close at $53.18 per barrel in New York. Brent crude, used to price international oils, added 3 cents to close at $55.89 per barrel in London.

CURRENCIES: The dollar resumed its fall after briefly bouncing back from its slide. The dollar has continued its slide following President Donald Trump’s comment in an interview with The Wall Street Journal that the dollar was “getting too strong.” The dollar was trading at 108.93 yen, down from 109.12 yen. The euro rose slightly to $1.0620 from $1.0616.

source: business.inquirer.net

Asian markets mostly lower, watching Trump speech closely

TOKYO — Asian markets were mostly higher Wednesday as attention turned to President Donald Trump’s speech to Congress for clues on what might be ahead for trade, regulations and taxes.

KEEPING SCORE: Japan’s benchmark Nikkei 225 gained 0.5 percent in morning trading to 19,222.56. Australia’s S&P/ASX 200 slipped 0.6 percent at 5,676.90. But Hong Kong’s Hang Seng added 0.4 percent to 23,824.17, while the Shanghai Composite rose 0.5 percent to 3,257.53. South Korea’s markets were closed for a holiday. Australia’s S&P ASX/200 fell 0.5 percent to 5,685.00.

TRUMP SPEECH: Investors were listening closely to Trump’s speech to Congress, hoping for concrete policies to match his promises for an economic revival. Trump’s plans for tax reform, deregulation and ramped up spending on defense and infrastructure projects have mostly sent world share benchmarks higher.

THE QUOTE: “President Trump’s address will undoubtedly create short term volatility this morning in most markets. Markets will be hanging on every word, looking for some tremendously wonderful concrete details of his administration’s fiscal plans,” said Jeffrey Halley, senior market analyst at OANDA.

WALL STREET: The Dow fell 25.20 points, or 0.1 percent, to 20,812.24. The Standard & Poor’s 500 index slid 6.11 points, or 0.3 percent, to 2,363.64. The Nasdaq composite index lost 36.46 points, or 0.6 percent, to 5,825.44.

ENERGY: Benchmark U.S. crude added 12 cents to $54.13 a barrel in New York. It slipped 4 cents, or 0.1 percent, to $54.01 Tuesday. Brent crude, which is used to price international oils, added 13 cents to $56.64 a barrel in London.

CURRENCIES: The dollar rose to 113.19 yen from Tuesday’s 112.57 yen. The euro slipped to $1.0566 from $1.0586.

source: business.inquirer.net

Asian markets ease as oil prices struggle

HONG KONG, China—Most Asian markets dipped Thursday, with energy firms struggling after another sell-off in oil fuelled by concerns about a planned output cut.

Crude prices are slumbering at three-month lows after OPEC member Iraq and non-member Russia suggested this week they would not take part in any limitations, despite a painful global supply glut.

Their comments have raised questions about the viability of a last month’s agreement at oil cartel OPEC to reduce output, which sent prices soaring.

Both main contracts have tumbled more than three percent this week and news that US stockpiles had fallen more than expected last week was unable to provide any support.

“Iraqi demands to join the list of countries exempted from quotas have simply added to the uncertainty” that an output cut can be implemented, Research firm Capital Economics said in a commentary.

“We have long been sceptical of the chances of a game-changing deal and continue to forecast that both Brent and WTI will end the year back at around $45 per barrel.”

Regional energy firms extended recent losses. Hong Kong-listed CNOOC sank more than three percent, with traders also selling on the back of a weak earnings report.

PetroChina lost 1.5 percent in Hong Kong, while Sydney-listed Woodside Petroleum was 1.5 percent off and Santos lost one percent.

Among regional markets Tokyo ended the morning down 0.3 percent, Hong Kong shed 0.9 percent—extending a one percent loss Wednesday—and Shanghai slipped 0.2 percent.

Seoul, however, added 0.2 percent, boosted by market heavyweight Samsung Electronics’ two percent surge.

The firm confirmed a 30 percent plunge in third-quarter operating profit linked to its Galaxy Note 7 crisis but later announced its heir apparent JY Lee had joined the board, putting him a step towards control of the family-run conglomerate.

Lee Chaiwon, chief investment officer at Korea Value Asset Management said JY’s bigger role should provide a much-needed boost to the under-fire company, saying it “will become more market-friendly and will “quicken its restructuring process”.

The dollar rose against the pound, euro and other high-yielding currencies as a preliminary survey showing the key US services sector expanded in October reinforced expectations the Federal Reserve will lift interest rates before the end of the year.

Key figures around 0230 GMT

Tokyo – Nikkei 225: DOWN 0.3 percent at 17,341.23 (break)

Hong Kong – Hang Seng: DOWN 0.9 percent at 23,105.12

Shanghai – Composite: DOWN 0.2 percent at 3109.37

Euro/dollar: DOWN to $1.0897 from $1.0907 Wednesday

Dollar/yen: DOWN to 104.44 yen from 104.51 yen

Pound/dollar: DOWN to $1.2214 from $1.2242

Euro/pound: UP to 89.19 pence from 89.09 pence

Oil – West Texas Intermediate: Flat at $49.18 a barrel

Oil – Brent North Sea: DOWN four cents at $49.94

New York – Dow: UP 0.2 percent to 18,199.33 (close)

London – FTSE 100: DOWN 0.9 percent at 6,958.09 (close)

source: business.inquirer.net

Asian markets tumble as oil collapses again

HONG KONG—The slump in oil dominated the mood on Asian markets Wednesday after falling back below $30 a barrel, hammering energy firms once again and sending stocks deeper into the red.

With the euphoria of Friday’s Bank of Japan stimulus but a distant memory, Tokyo led the regional losses followed by Hong Kong, where insurance giant AIA lost almost a 10th of its value on fears China would tighten insurance rules.

The plunge in oil prices to 12-year lows has sent shudders through world markets, helping wipe trillions of dollars off valuations, even leading to the word “recession” raising its head.

Crude resumed its downward trend this week, jettisoning most of the gains seen in a four-day rally last week fuelled by hopes for OPEC-Russian talks on output cuts.

US benchmark West Texas Intermediate crashed more than 11 percent on Monday and Tuesday to fall back through the $30 level for the first time since January 21. Brent lost almost six percent in the same period.

And on Wednesday the losses piled up ahead of a US report that analysts warned could see a further increase in stockpiles. WTI lost one percent and Brent 0.9 percent in early Asian trade.

Oil prices have crumbled about 75 percent since mid-2014, hit by a perfect storm of weak demand, oversupply, overproduction, a slowing global economy and a strong dollar.

After already taking a hit on Tuesday, regional energy stocks were buffeted again on Wednesday.

In Hong Kong, CNOOC shed 5.7 percent and PetroChina dived five percent while Kunlun Energy sank 5.6 percent.

Sydney-listed Santos lost 7.5 percent and mining giant BHP Billiton lost 4.2 percent while Woodside Petroleum fell 4.3 percent.

Inpex gave up three percent in Tokyo, where JX Holdings was 2.8 percent off.

‘Talk of recession louder’

The losses followed other big guns in New York and Europe. BP lost 8.7 percent in London after it suffered a loss of $6.48 billion last year and announced another 3,000 job cuts. Chief executive Bob Dudley warned: “We expect 2016 to be tough.”

BP’s American rival, ExxonMobil, managed to stay profitable, but reported a 58 percent drop in fourth-quarter earnings and announced plans to slash its capital budget and suspend its share repurchase programme.

“The underlying fundamentals are deteriorating and the talk of recession is getting louder,” Chris Weston, chief market strategist at in Melbourne at IG Ltd., told Bloomberg News.

“When you see BP coming out with disastrous results and when you see Exxon cutting back on expenditures again, you realise the implication weak oil has on economies.”

Tokyo’s Nikkei index sank 3.1 percent by lunch, while Hong Kong was almost three percent off, Sydney lost 2.1 percent and Seoul shed 1.1 percent. Shanghai slipped one percent.

There were also sharp losses across other parts of Asia, with Singapore, Manila and Kuala Lumpur worst hit.

In Hong Kong, insurance giant AIA lost 8.8 percent in the morning following a Bloomberg News report that China would clamp down on the purchase of overseas cover. AIA’s US shares lost more than five percent.

Beijing wants to close a loophole in its capital controls aimed at stemming the outflow of its depreciating yuan currency, as the economy logs its slowest growth in 25 years.

Manulife, another Hong Kong-listed insurer, shed 5.5 percent.

source: business.inquirer.net