Asian shares track Wall Street losses on weak US factory data

BANGKOK – Asian shares are lower after U.S. stocks posted their worst loss in five weeks on Wednesday after a surprisingly limp report on the nation’s manufacturing that stirred worries about the economic outlook.

Japan’s Nikkei 225 index shed 0.6% to 21,758.02 while the Hang Seng in Hong Kong lost 0.4% to 25,980.37. Sydney’s S&P ASX 200 gave up 1.3% to 6,658.20.

The Kospi in South Korea sank 1.4%, to 2,044.01 after North Korea fired a ballistic missile toward the sea Wednesday, South Korea’s military said, in a display of its expanding military capabilities hours after saying it would resume nuclear diplomacy with the United States this weekend.

The report showed that manufacturing weakened in September for the second straight month as President Donald Trump’s trade war with China dragged on confidence and factory activity. It dashed economists’ expectations that August’s contraction had been an aberration, and stocks and bond yields immediately reversed course to drop sharply lower following the report.

The S&P 500 slumped 1.2% to 2,940.25 for its sharpest loss since August. The Dow Jones Industrial Average fell 1.3% to 26,573.04, and the Nasdaq composite dropped 1.1% to 7,908.68.

Small-company stocks fell more than the rest of the market. The Russell 2000 index lost 2%, to 1,493.43.


In the bond market, the yield on the 10-year Treasury dropped to 1.66% from 1.74% before the report’s release, which is a big move. Three stocks fell for every one that rose on the New York Stock Exchange, and gold climbed as investors sought safer ground.

Economists had been expecting growth to resume in September, and they had forecast a reading of 50.4, according to FactSet.

Manufacturers say global trade remains the most significant issue, and all the uncertainty caused by the trade war is hurting exporters in particular. Businesses are unsure what the rules of international trade will be, and it’s causing CEOs to pull back on their spending plans. In a separate report, the World Trade Organization said global trade growth will slow to its weakest pace this year since 2009.

“The disappointing data is only fanning long-standing fears of slowing global growth,” said Alec Young, managing director of Global Markets Research at FTSE Russell.

Manufacturing is a relatively small part of the economy, but investors worry about whether it will spill into other areas. That puts an even bigger spotlight on Friday’s jobs report, which economists expect to show an acceleration in hiring.


Household spending has been a pillar for the economy, particularly when manufacturing and business spending are under threat, and a strong job market helps households keep spending. But uncertainty is looming even there.

A report last week showed that consumer spending rose less than economists expected in August. Two reports on consumer confidence last week gave a mixed picture, with one falling below expectations and the other rising above.

Last month’s jobs report was also surprisingly weak, but that may have been a one-off, some analysts say.

“The month of August over the last 10 years has been the wonkiest jobs report of the year,” said Philip Orlando, chief equity market strategist at Federated Investors. It often falls below expectations, only for the numbers to be revised higher in subsequent months, he said.

“There’s no question the data has been softer, slower, weaker, pick your adjective for today versus a year ago,” Orlando said about the broad economy. “But I do think we’re going to get through this.”

The Fed and other central banks around the world have been aggressive in keeping rates low to shield against the effects of the trade war and slowing global economic growth. The Fed lowered short-term rates twice this summer, down to a range of 1.75% to 2%, the first cuts since the financial crisis was toppling economies around the world in 2008.

Benchmark crude oil rebounded, gaining 56 cents to $54.18 per barrel in electronic trading on the New York Mercantile Exchange. It fell 45 cents to $53.62 a barrel on Tuesday. Brent crude oil, the international standard, picked up 41 cents to $59.30 per barrel.

The dollar rose to 107.87 Japanese yen from 107.73 yen on Tuesday. The euro strengthened to $1.0937 from $1.0934. /gsg

source: business.inquirer.net

US Stock Market Experienced Gains After Impeachment Probe

Wall Street stocks were mixed early Wednesday, with Nike and Boeing gaining, as investors took a wait-and-see approach to a congressional impeachment investigation of President Donald Trump.

The anticipation of the impeachment probe was a factor in the stock market’s retreat on Tuesday.

But the US stock market and investors appeared to be taking the news in stride after House Democratic Leader Nancy Pelosi formally announced the probe.

Wednesday’s flattish early trading “suggests that the market isn’t going to allow itself to get too worked about the inquiry at this stage of matters when the headlines are heavy but the tradable facts of import are light,” analyst Patrick O’Hare wrote at Briefing.com.

About 20 minutes into trading, the Dow Jones Industrial Average stood at 26,841.85, up 0.1 percent.

The broad-based S&P 500 was essentially flat at 2,965.68, while the tech-rich Nasdaq Composite Index had shed 0.2 percent at 7,978.90.


Among individual companies, Dow member Nike surged 5.2 percent after reporting better-than-expected quarterly profits on strong direct sales and higher revenues from China.

Boeing also added to the Dow’s gains, advancing 0.6 percent as it announced a number of reforms to its board and corporate structure to highlight safety concerns after two crashes led to 346 fatalities and the grounding of its popular 737 MAX plane.

Philip Morris International jumped 5.9 percent as it and Altria called off a potential $200 billion merger following a sudden surge in worries about vaping.

Altria, which holds a major stake in e-cigarette company Juul, gained 0.5 percent.

source: usa.inquirer.net

Fear on Wall Street of an Economic Slowdown

U.S. stocks fell broadly in midday trading Wednesday as central banks around the world cut interest rates and increased fears that global growth is being crimped by the U.S.-China trade war.

Every major U.S. index fell and put stocks back on a course for losses after briefly breaking a six-day losing streak on Tuesday. The losses eased as the day progressed, though investors remained in a defensive mode and headed for relatively safe holdings.

Bond prices spiked again, sending the yield on the 10-year Treasury down to 1.64% from 1.74% late Tuesday, a large move.

Yields are at their lowest level in nearly three years. That benchmark yield has retreated from its recent high of 3.23% last November as expectations of economic growth have steadily faded.


“The Treasury market is trading much higher this morning as investors continue to seek a safer haven, completely unsure as to what may happen next,” Kevin Giddis, head of fixed income capital markets at Raymond James wrote in a report.

Banks sustained some of the worst losses. Lower bond yields mean lower interest rates on mortgages and other kinds of loans, which mean lower profits for banks. JPMorgan Chase fell 3.1% and Bank of America fell 3.3%.

The dimming expectations for global growth also send the price of crude oil sharply lower. Benchmark U.S. crude plunged 4.5% at $51.20 a barrel. That helped pull energy sector stocks lower. Occidental Petroleum gave up 3.3%.

Big technology stocks, longtime investor favorites, also posted hefty losses. IBM lost 1.8%.

Safe-play stocks, including consumer staples and utilities, held up far better than the rest of the market.

The S&P 500 index fell 0.5% as of 11:12 a.m. Eastern time. The Dow Jones Industrial Average fell 238 points, or 0.9%, to 25,790. It was down as much as 589 earlier.

The Nasdaq fell 0.1%

China on Monday allowed its currency, the yuan, to weaken against the U.S. dollar in response to U.S. threats to add more tariffs to Chinese goods.

China stabilized the yuan on Tuesday and that helped lift U.S. stocks a day after they endured their worst day of the year. The volatile trading has already put a dent in the major indexes yearly gains. The S&P 500 is down 3.8% for August.

Central banks in New Zealand, India, and Thailand cut key interest rates on Wednesday and investors around the world fear that the escalating trade war between the U.S. and China will severely damage global growth.

After the surprise interest-rate cuts, bond yields sank around the world as investors scrambled for safety. They also poured into gold, which jumped to its highest price in more than six years.

“There is almost a paranoia amongst central bankers to avoid any potential financial hiccups that might hurt the real economy and cause a slowdown,” Jefferies strategist Sean Darby wrote in a report.

U.S. stocks have been on a wild ride since Jan. 22, 2018, when Trump first imposed tariffs on solar products and washing machines to help U.S. manufacturers, but they’re virtually back to where they started.

The S&P 500 closed at 2,832.97 that day and has since been down as much as 17% and up as much as 7%, with moves often driven by waxing and waning worries about the trade war. On Wednesday morning, the S&P 500 sat at 2,862.45, up 1% from that early 2018 starting point.

Since Trump tweeted in March 2018 that “trade wars are good, and easy to win” after raising tariffs on steel and aluminum, the S&P 500 is up 6.3%, though that gain has nearly halved in the last couple weeks as worries about the trade war have surged.

A key gauge of fear in the marketplace surged 6.2%. The VIX index, which measures how much traders are paying to protect themselves from swings in the S&P 500, was still below where it was at the start of the year when recession fears were surging, but it’s close to its highest level of the year.

European and Asian indexes were mixed.

Disney fell 5.1% after disappointing investors with a sharp third-quarter profit plunge that fell far short of Wall Street forecasts.

The entertainment company said underperformance from its Fox movie and TV studio helped weigh down the fiscal third-quarter financial results. It bought Fox’s entertainment business in March for $71 billion.

Match Group shares jumped 25.2% after the operator of Tinder, OkCupid and other dating sights beat Wall Street’s second-quarter earnings forecasts. The company reported a surge in Tinder subscribers and raised its revenue forecast for the year.

Drugstore operator CVS Health rose 6% after swinging to a second-quarter profit and handily beating Wall Street forecasts. The company attributed part of the gains to health insurer Aetna, which it bought for $69 billion in November.

source: usa.inquirer.net

Gold market demand quiet despite recent strong gains in Vietnam

HANOI — Gold futures for the first time in six years broke the US$1,450 an ounce last week, gaining 1.75 percent last Friday and a total 13.6 percent since May 28.

The strong growth of gold futures is attributed to previous speculations of a Fed rate cut – which was realized on May 31, worries about the global economy outlook, and increasing political, geographical and economic tensions.

Those developments, especially the Fed rate cut, sent US bond yield rates down and weakened the US dollar, which are the key factors making gold more expensive.

In addition, more tensions around the globe have pushed investors away from risky assets like stocks and towards safety in gold. Meanwhile, the possibility of a global economic slowdown increases after China reported its Q2 economic growth of 6.2 percent is the lowest in 30 years and central banks have delivered gloomier economic growth forecasts.

Those negative factors are forecast to boost gold prices to $2,000 an ounce at the end of the year as they may make investors more pessimistic and avoid purchasing risky assets.

The increases of gold futures on global markets also raises the prices of Vietnamese gold products to around VNĐ40 million per tael, equal to VND30 million ($1,290) an ounce


Since May 28, prices of gold products have gained about 10 percent at Phu Nhuan Jewellery JSC (PNJ) to VND39.92 million for a tael, equal to VNĐ29.94 million an ounce.


Though prices have reached new levels, market demand is quiet, proving Việt Nam’s success with its anti-gold policy.

According to Phan Dung Khanh, director of investment consultancy department at Maybank Kim Eng Securities Co Ltd, the domestic gold market may not heat up like it did eight years ago.

Some factors that may benefit the domestic gold market include the stability of foreign exchange rates between the Vietnamese dong and foreign currencies, a zero per cent US dollar savings yield rate and tightened policies regarding the number of eligible gold businesses, he told Dau Tu (Investment) newspaper.

According to banking expert Can Van Luc, the domestic gold market was quite quiet in the first six months of the year though gold prices gained 10 per cent globally and 6.3 per cent in the domestic market.

In the past, buyers rushed to gold shops immediately when they heard gold prices were up only 2-3 per cent, he said.

The gold market had been controlled well and the stability of the foreign exchange rates had increased the economy’s creditability to people, making them less interested in buying gold, Luc said.

The domestic gold market had remained stable, economist Nguyen Minh Phong said, as there was not much difference between buying and selling rates as well as between global and domestic gold prices.

The daily trading was stable, plus, the central bank did not have to make public announcements to stabilize the market – which had been done before whenever the market turned volatile, Phong said.

In addition, rushing into gold at the moment may not be a smart decision, especially after the Fed cut lending rates, business insiders said.

Buying gold is somewhat risky in the short term while there are also other attractive options for investors such as securities, real estate and corporate bonds, they said.

Gold should be a long-term investment for institutional investors and any individuals buying in gold must stay updated about prices to lock in profits at the right moment, they said.

source: business.inquirer.net

Asian stocks follow Wall Street lower on trade war fears

BEIJING – Asian stock markets on Thursday followed Wall Street lower after President Donald Trump reignited trade fears by saying he could impose more tariffs on Chinese imports.

Benchmarks in Shanghai, Tokyo, Hong Kong and Sydney all declined. Oil rebounded from the previous day’s losses.

Trump alarmed investors by saying he had $325 billion of Chinese imports available for additional tariffs “if we want.” That shook markets that had been reassured by Trump’s agreement with Chinese President Xi Jinping in June to hold off on new trade penalties while they resume negotiations.

The Chinese government warned tariff hikes would “create a new obstacle” in talks on ending their bruising fight over Beijing’s technology ambitions.

Trump’s comment “cast a dark cloud over lingering concerns on trade talk progress,” said Mizuho bank analysts in a report.

The Shanghai Composite Index lost 0.6% to 2,913.49 and Tokyo’s Nikkei 225 tumbled 1.6% to 21,128.12. Hong Kong’s Hang Seng retreated 0.4% to 28,465.17 and Seoul’s Kospi was 0.2% lower at 2,066.94.


Sydney’s S&P-ASX 200 shed 0.3% to 6,655.60 and Taiwan and Southeast Asian markets also retreated. New Zealand gained.

On Wall Street, stocks extended their losses into a second day as railroad operator CSX had its biggest drop in 11 years, pulling other industrial companies down with it. CSX plunged 10.3% after saying it expects this year’s revenue to decline as much as 2%, after previously saying it expected growth.

Banks fell as investors worried lower interest rates will hurt profits. Investors expect the Federal Reserve to cut interest rates for the first time in a decade at their next policy meeting in two weeks.

Corporate earnings reports are getting into full swing this week, and investors have been mostly cautious in their assessments of them. Earnings are still expected to decline for S&P 500 companies in the second quarter.

ENERGY: Benchmark U.S. crude gained 1 cent to $56.79 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 84 cents on Wednesday to close at $56.78. Brent crude, used to price international oils, advanced 17 cents to $63.83 in London. It lost 69 cents the previous session to $63.66.

CURRENCY: The dollar declined to 107.73 yen from Wednesday’s 107.97 yen. The euro gained to $1.1239 from $1.1226./gsg

source: business.inquirer.net

Asian shares mostly lower as investors look to G-20 meeting

TOKYO – Asian shares were mostly lower Wednesday as investors awaited developments on the trade friction between the U.S. and China at the Group of 20 meeting of major economies in Japan later in the week.

Japan’s benchmark Nikkei 225 slipped 0.5% to 21,088.32 in early trading, while Australia’s S&P/ASX 200 inched down nearly 0.1% to 6,652.20. South Korea’s Kospi stood virtually unchanged but a tad lower at 2,121.24.

Hong Kong’s Hang Seng edged up 0.1% to 28,214.56, while the Shanghai Composite inched up less than 0.1% at  2,982.65.

On Wall Street, discouraging economic data and cautionary remarks from the head of the Federal Reserve weighed on the market.

The sell-off marked the third straight loss for the market and the biggest drop this month for the Dow Jones Industrial Average and the S&P 500 index, which hit an all-time high only last week.

In an early afternoon speech, Fed Chairman Jerome Powell noted that the economic outlook has become cloudier since early May amid uncertainty over trade and global growth.

Earlier Tuesday, reports showed a decline in consumer confidence and more weakness in the housing market.

The S&P 500 index fell 27.97 points, or 1%, to 2,917.38.

The Dow dropped 179.32 points, or 0.7%, to 26,548.22. The Nasdaq composite, which is heavily weighted with technology stocks, slid 120.98 points, or 1.5%, to 7,884.72.

The Russell 2000 index of smaller company stocks gave up 9.05 points, or 0.6%, to 1,521.04.

Trade policy remains the biggest source of uncertainty looming over the market. Investors are worried about the trade dispute between the U.S. and China and its potential impact on global economic growth and corporate profits.

Presidents Donald Trump and Xi Jinping will meet this week at the G-20. The world’s two largest economies spent much of the current quarter escalating their trade war and giving global markets jitters over prospects for economic growth.

“To a large extent, any further deterioration in trade relations is expected to guide expectations here so the focus remains up ahead with the G-20,” said Jingyi Pan, market strategist at IG in Singapore.

ENERGY:

Benchmark crude oil rose $1.05 to $58.88 a barrel. It fell 7 cents to settle at $57.83 a barrel Tuesday. Brent crude oil, the international standard, rose 73 cents to $65.01 a barrel.

CURRENCIES:

The dollar rose slightly to 107.46 Japanese yen from 107.03 yen on Tuesday. The euro weakened to $1.1357 from $1.1381. /gsg

source: business.inquirer.net

Shanghai leads gains in Asia as China-US talks resume

SINGAPORE — Mainland Chinese markets led Asian indexes higher on Friday, as the U.S. and China kicked off a fresh round of trade talks in Beijing.

The Shanghai Composite index advanced 2.9 percent to 3,081.11 and Hong Kong’s Hang Seng jumped 1 percent to 29,055.99.

South Korea’s Kospi gained 0.6 percent to 2,140.67.

Japan’s benchmark Nikkei 225 rose 0.8 percent to 21,205.81.

The country’s retail sales fell slightly in February from a month earlier, preliminary data showed.

But industrial production rose 1.4 percent after a 3.4 percent decline in January.

The unemployment rate beat market expectations, falling to 2.3 percent in February from 2.5 percent in the previous month.

Australia’s S&P/ASX 200 edged 0.1 percent higher to 6,180.70.

Shares rose in Taiwan and most of Southeast Asia.


U.S. negotiators, led by Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, attended a working dinner Thursday night with Chinese Vice Premier Liu He, who is expected to travel to Washington next week.

The three of them posed for a photo at a government guesthouse before negotiations resumed on Friday but did not talk to reporters.

On Wall Street, traders shrugged off a discouraging announcement by the Commerce Department. It said U.S. economic growth had slowed sharply in the last three months of 2018 to an annual rate of just 2.2 percent, due to weakness in consumer spending, business investment, government spending and housing.

Most indexes finished higher, as bond yields rose and financial, technology and industrial stocks climbed.

The broad S&P 500 index was 0.4 percent higher at 2,815.44.

The Dow Jones Industrial Average also gained 0.4 percent to 25,717.46.

The Nasdaq composite rose 0.3 percent to 7,669.17 and the Russell 2000 index of smaller company stocks picked up 0.8 percent to 1,535.10.

ENERGY: Benchmark U.S. crude added 31 cents to $59.61 per barrel in electronic trading on the New York Mercantile Exchange. It lost 11 cents to settle at $59.30 per barrel on Thursday. Brent crude, used to price international oils, edged up 30 cents to $67.40 per barrel. The contract shed 14 cents to $67.10 per barrel in London.

CURRENCIES: The dollar strengthened to 110.68 yen from 110.63 yen. The euro rose to $1.1231 from $1.1221. /gsg

source: business.inquirer.net

Types of Home Loans

It is necessary for investors to understand that the business of real-estate might look transparent from a regular perspective with a robe of simplicity on. However, certain crucial aspects need to be investigated before investment in any property. Before you enter into a purchase agreement to buy your next home, it would be to your greatest advantage to locate the most valuable home loan program for you and your family. The complexities of each home loan type might overpower, yet with a little research and exhortation from a proficient credit officer you ought to almost certainly discover a home loan program that will give you and your money related circumstance the best advantages. Up front installment, financing cost, credit term, and private home loan protection all portray a home loan, however seeing how rules contrast from home loan program to program will enable you to locate the most worthwhile parts of each advance kind and the least demanding way to endorsement.

The following is a rundown of the four fundamental home loan types, they include: Regular,  Federal Housing Administration (FHA), Veterans Administration (VA), and the United States Department of Agriculture (USDA). As you filter through the rules of these home loan types, you will find that the up front installment, FICO rating, work history, co-endorser choices, and property condition prerequisites change extraordinarily.



Conventional Mortgage

These loans are backed by Fannie Mae or Freddie Mac who have set regulations and requirements for their procedures. The Fannie Mae mortgage-backed bond is linked to mortgage interest rates via Fannie Mae. The Freddie Mac mortgage-backed bond is linked to mortgage-backed bonds via Freddie Mac.

Mortgage programs that use conventional mortgage interest rates include the "standard" 30-year fixed-rate mortgage rate for borrowers who make a 20% downpayment or more; the HARP loan for underwater borrowers; the Fannie Mae HomePath mortgage for buyers of foreclosed properties; and, the equity-replacing Delayed Financing loan for buyers who pay cash for a home.


Federal Housing Administration (FHA)

The FHA home loans have been helping many borrowers seeking a low down payment mortgage program, and also for those that need a bad credit mortgage. FHA mortgages can help a 1st time home buyer or 2nd time home buyer. You're able to use the FHA loan as many times as you move to a new home.

FHA home loans are now being given to people with blemished credit. The Federal Housing Administration is a government agency that insures the loan you are applying for from private lenders. Anytime you are unable to pay, they will partly do so on your behalf. With the government securing the loan, it definitely gives lending company the assurance they need. For this reason, even with a bruised credit score, you can apply for this loan and use it to buy or construct your own home.


Veteran's Administration (VA)

VA loans require a Certificate of Eligibility that documents your past or current military service, it is exclusive to those who bravely served our country and are available to those who have served our country and offer a number of advantages.

Lenders with trained personnel that work with the VA home loan program can easily acquire this document. However, in some cases, the applicant must fill out a form or other form online or by mail to receive the document. You must also have a reasonably Good Credit record.


United States Department of Agriculture (USDA)

This loan type is a loan from the United States Department of Agriculture, this program is overseen by the Rural Housing Service (RHS). This loan is designed for borrowers with low income that live in rural areas that have trouble getting financial assistance from traditional lenders.

Lawsuits accuse Tesla's Musk of fraud over tweets, going-private proposal

Tesla Inc and Chief Executive Elon Musk were sued twice on Friday by investors who said they fraudulently engineered a scheme to squeeze short-sellers, including through Musk's proposal to take the electric car company private.

The lawsuits were filed three days after Musk stunned investors by announcing on Twitter that he might take Tesla private in a record $72 billion transaction that valued the company at $420 per share, and that "funding" had been "secured."

In one of the lawsuits, the plaintiff Kalman Isaacs said Musk's tweets were false and misleading, and together with Tesla's failure to correct them amounted to a "nuclear attack" designed to "completely decimate" short-sellers.

The lawsuits filed by Isaacs and William Chamberlain said Musk's and Tesla's conduct artificially inflated Tesla's stock price and violated federal securities laws.

Tesla did not respond to a request for comment on the proposed class-action complaints filed in the federal court in San Francisco. The company is based in nearby Palo Alto, California.

Short-sellers borrow shares they believe are overpriced, sell them, and then repurchase shares later at what they hope will be a lower price to make a profit.

Such investors have long been an irritant for Musk, who has sometimes used Twitter to criticize them.

Musk's Aug. 7 tweets helped push Tesla's stock price more than 13 percent above the prior day's close.

The stock has since given back more than two-thirds of that gain, in part following reports that the US Securities and Exchange Commission had begun inquiring about Musk's activity.

Musk has not offered evidence that he has lined up the necessary funding to take Tesla private, and the complaints did not offer proof to the contrary.

But Isaacs said Tesla's and Musk's conduct caused the volatility that cost short-sellers hundreds of millions of dollars from having to cover their short positions, and caused all Tesla securities purchasers to pay inflated prices.

Tesla's market value exceeds $60 billion, and its shares closed Friday up $3.04 at $355.49.

According to his complaint, Isaacs bought 3,000 Tesla shares on Aug. 8 to cover his short position.

The proposed class period in Isaacs' lawsuit runs from the afternoon of Aug. 7 through the next day, and in Chamberlain's lawsuit runs from Aug. 7 to Aug. 10. — Reuters

Trade tensions torpedo oil, US sanctions hammer Russian rouble

SYDNEY — Asian shares were subdued on Thursday after a new round of tit-for-tat tariffs in the US-Sino trade conflict torpedoed oil prices, while the Russian rouble tumbled as the US slapped fresh sanctions on the country.

MSCI's broadest index of Asia-Pacific shares outside Japan barely budged as caution dominated. Japan's Nikkei slipped 0.5 percent, not helped by a shock slump in core machinery orders.

Early Thursday, China's state broadcaster said China must counteract US tariffs and Beijing had the confidence to protect its own interests as well as the means to do so.

China had already announced additional tariffs of 25 percent on $16 billion worth of US imports from fuel to autos. The tariffs will apply to billions of dollars in U.S. gasoline, diesel and other oil products, though not crude.

Analysts at ANZ noted there were also reports President Xi Jinping had asked China's major oil companies to increase domestic output to safeguard the country's energy security.

The oil market took the news hard with selling escalating as major technical levels broke.

US crude was last down 12 cents at $66.82 per barrel, having shed 3.2 percent on Wednesday, while Brent was off 2 cents at $72.26.

On Wall Street, trade-sensitive industrial companies were the biggest drag on the Dow, with declines led by Boeing and Caterpillar Inc.

The Dow fell 0.18 percent, while the S&P 500 lost 0.03 percent and the Nasdaq added 0.06 percent.

More sanctions

In currency markets, the Russian rouble sank after Washington said it would impose fresh sanctions because it had determined that Moscow had used a nerve agent against a former Russian agent and his daughter in Britain.

There were also reports of a new US Senate bill that would impose widespread sanctions on Russia for election meddling.

The rouble duly slid to its lowest since late 2016, with the dollar buying 65.50 roubles having jumped 3.4 percent overnight.

The pound skidded to its lowest against the dollar and euro in almost a year as fears grew Britain might leave the EU without a deal on trade with Brussels.

Traders reported a significant increase in investors hedging against a 'no-deal' Brexit, an event which could send sterling into free fall and hurt the economy by raising trade barriers with the UK's biggest export market.

Sterling was last trading at $1.2877, having dropped 0.4 percent overnight.

The Japanese yen seemed to be catching a bid as a traditional safe haven, with the dollar easing to 110.81 yen after stretching as high as 111.44 on Wednesday.

The euro was relatively steady at $1.1611, while the dollar index was a shade firmer at 95.098.

The New Zealand dollar shed 0.9 percent to a two-year trough at $0.6682 after the country's central bank took a dovish turn, pledging to keep rates at record lows well into 2020.

The Reserve Bank of New Zealand (RBNZ) said rates were likely to be on hold for longer and cut its forecasts for economic growth this year and next. —Reuters

Threshold for foreign investors to be lowered in China

BEIJING — China plans to lower the threshold for foreign investors to make strategic investment in listed companies in the nation, which is the latest in a series of measures to further open the market.

That’s according to a draft of revised rules released by the Ministry of Commerce, which has been sent for public comments. The ministry said the revisions were drafted to expand the channels of using foreign investment and promote the healthy development of China’s securities market.

“The move is an important incentive for foreign investors to invest in China, a part of the nation’s substantial measures to further open up the economy,” said Li Shuguang, an economist and a professor at China University of Political Science and Law.

In the draft, the ministry suggested that A shares acquired by foreign investors through strategic investment are not tradable for 12 months. Under current rules, such shares are not tradable for three years.

“This shortened lockup period would create more liquidity for foreign investors, so they can control their capital flow in a much more flexible manner,” Li said.

The ministry also proposed loosening controls over the requirements for foreign investors in the draft as follows: To participate in strategic investments in listed firms in China, a foreign company must own actual overseas assets of no less than $50 million or manage actual overseas assets of no less than $300 million.

Current regulations require that a foreign firm own assets of no less than $100 million or manage assets of no less than $500 million.

Li said: “The capital threshold, according to the revised rule, would be lowered by around 50 per cent, which will generate fresh opportunities for more foreign investors to enter the Chinese market.”

The ministry suggested reviewing strategic foreign investment applications in national security related areas, in line with national security rules.

This year marks the 40th anniversary of China’s reform and opening-up policy. The government has rolled out a set of measures to facilitate foreign investment and improve business environment.

In early July, the country released a shorter negative list for free trade zones and a list applicable nationwide. The list shows areas where investment is limited or prohibited for foreign investors, with all other areas presumed to be open.

The new list reduces the number of sectors restricted for foreign investors to 45 in all free trade zones, from 95 last year.

Wei Jianguo, a former vice-minister of commerce, said China’s stance on opening-up has offered and will continue to, offer opportunities for other countries to share the benefits of its growth.

source: business.inquirer.net

US stocks swoon, sending Dow down more than 650 points

U.S. stocks slumped Friday, and the market suffered its worst week in two years, as fears of inflation and disappointing quarterly results from technology and energy giants spooked investors. The Dow Jones industrial average dropped by more than 650 points.

Bond yields rose and contributed to the stock market swoon after the government reported that wages grew last month at the fastest pace in eight years. The Dow had its worst decline since June 2016, while the broader Standard & Poor’s 500 index had its biggest one-day percentage drop since September 2016.

“We’ve enjoyed low interest rates for so long, we’re having to deal with a little bit higher rates now, so the market is trying to figure out what that could mean for inflation,” said Darrell Cronk, head of the Wells Fargo Investment Institute.

The increase in bond yields hurts stocks in two ways: it makes it more expensive for companies to borrow money, and it also makes bonds more appealing to investors than riskier assets such as stocks.

Several major companies, including Exxon Mobil and Google’s parent company, Alphabet, sank after reporting weak earnings. Apple fell on concerns about iPhone sales.

The sharp decline in stocks this week short-circuited a robust start to the year that was spurred by strong global economic growth, solid company earnings and lingering enthusiasm for the GOP tax overhaul. Even with the pullback, the major indexes are still up more than 3 percent this year.

The downturn also follows a long period of unprecedented calm in the market. Stocks haven’t had a pullback of 10 percent or more in two years, and hit their latest record highs just one week ago.

The S&P 500 fell 59.85 points, or 2.1 percent, to 2,762.13. The index has lost 3.9 percent since hitting a record high a week ago.

The Dow lost 665.75 points, or 2.5 percent, to 25,520.96. The Nasdaq slid 144.92 points, or 2 percent, to 7,240.95. The Russell 2000 index of smaller-company stocks gave up 32.59 points, or 2.1 percent, to 1,547.27.

While interest rates are still low by historical standards, meaning borrowing is still relatively cheap for businesses and people, they’ve been rising more swiftly, and that’s what has markets on edge.

“The pace of rate increases is more important than the level,” said Nate Thooft, senior portfolio manager at Manulife Asset Management.

The increase in rates has been driven by the prospect of stronger economic growth, and higher inflation, in the U.S. and abroad.

Bond prices declined again Friday, pushing yields higher. The yield on the 10-year Treasury note, a benchmark for interest rates on many kinds of loans, including mortgages, climbed to 2.84 percent, the highest level in roughly four years. The rate was at 2.41 percent four weeks ago and 2.66 percent on Monday.

“Once we started going north of 2.5 percent, and you put that together with an overbought market, it had the ingredients of a sell-off, especially since January was so strong,” said Jeff Zipper, regional investment strategist at U.S. Bank Private Wealth Management.

The S&P 500, which many index funds track, soared 5.6 percent in January, its biggest monthly gain since March 2016.

One concern for investors is that the Federal Reserve will respond to higher inflation by raising its key interest rate more quickly than expected. The government’s latest job and wage data stoked those concerns Friday.

U.S. employers added a robust 200,000 jobs in January, slightly above market expectations for an 185,000 increase. Meanwhile wages rose sharply, suggesting employers are competing more fiercely for workers. The figures point to an economy on strong footing even in its ninth year of expansion, fueled by global economic growth and healthy consumer spending at home.

That’s good news for Main Street USA, but not for Wall Street. Some economists were predicting Friday that the central bank will raise its benchmark rate four times this year, rather than the three times most previously expected.

The market slide may have been overdue, particularly after the strong start for stocks this year where the S&P 500 had its best January in two decades. Some investors saw a potential buying opportunity.

The global economy is still strong, corporate profits and sales have been better than expected this reporting season and buyers for stocks still remain, all reasons to be optimistic about stocks, said Nate Thooft, senior portfolio manager at Manulife Asset Management.

“It’s appealing, these 2 to 3 percent pullbacks,” said Thooft, who had been trimming some of his stock holdings after the market’s big January gains. “We look at this and say, ‘Maybe it’s your first day to buy a little bit.'”

While earnings overall have been strong, some big companies have posted disappointing results.

Google’s parent company Alphabet slumped 5.3 percent after the search giant reported results that missed analysts’ forecasts. The stock slid $62.39 to $1,119.20.

Exxon Mobil dropped 5.1 percent, while Chevron lost 5.6 percent after the oil companies’ latest quarterly results fell short of forecasts. Shares in Exxon shed $4.54 to $84.53. Chevron gave up $6.99 to $118.58.

Apple declined 4.3 percent after the technology company said it sold 77.3 million iPhones in the last quarter, below the 80 million analysts expected. The stock slid $7.28 to $160.50.

Traders welcomed Amazon’s latest results. The e-commerce giant rose 2.9 percent after its fourth-quarter profit increased by more than $1 billion. Amazon shares gained $39.95 to $1,429.95.

Oil futures declined. Benchmark U.S. crude slid 35 cents, or 0.5 percent, to settle at $65.45 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, fell $1.07, or 1.5 percent, to close at $68.58 a barrel in London.

Wholesale gasoline fell 2 cents to $1.87 a gallon and heating oil fell 4 cents to $2.05 a gallon. Natural gas slipped 1 cent to $2.85 per 1,000 cubic feet.

Gold fell $10.60 to $1,337.30 an ounce. Silver dropped 45 cents to $16.71 an ounce. Copper lost 2 cents to $3.19 a pound.

The dollar rose to 110.28 yen from 109.42 yen on Thursday. The euro weakened to $1.2451 from $1.2502.

Major stock indexes in Europe also declined Friday. Germany’s DAX slid 1.7 percent, while France’s CAC 40 lost 1.6 percent. The FTSE 100 index of leading British shares gave up 0.6 percent.

In Asia, Japan’s benchmark Nikkei 225 fell 0.9 percent and South Korea’s Kospi slid 1.7 percent. Hong Kong’s Hang Seng index dipped 0.1 percent.

source: business.inquirer.net

Fears over bitcoin use in terror financing

The global bitcoin craze has attracted almost everyone, from mom-and-pop traders to giant investment banks.


Promoters of bitcoin and other cryptocurrencies tout them as being safe and secure, and without oversight from financial regulators.

But there is some concern that these very advantages could be exploited by terrorists to transfer funds from one place to another.

Financial intelligence experts from the region say this is already happening, with several suspicious financial transactions detected recently.

Some of these experts gathered in Malaysia last month for the Third Counter-Terrorism Financing Summit. The security experts from 35 countries unanimously agreed that the first step to disrupting militant operations is by cutting off their funds.

A new alliance between Australia and South-east Asia has also been formed to directly target and disrupt the funding lifeline of terrorist groups by denying them access to the international financial system and other sources of funds.Sources told The Straits Times that the high degree of anonymity offered by digital currencies makes them a possible preferred avenue for militants in South-east Asia.

“The number might not be big but we know it’s picking up. Their ultimate goal is to make sure that these funds get where they’re supposed to be,” said one source.

“Small or big, it can help move any terrorism planning to the next level – launching attacks.”

While the surge in the value of bitcoins and similar cryptocurrencies has garnered widespread media attention, security experts say the terrorists use digital currency not to make money, but for ease of moving funds between borders without the regular banking scrutiny.

For operational reasons, officials declined to reveal the locations and frequency of such transactions. But the identity of some of these financial movements on the Web has been determined, said a second source.

“Special equipment and database are already in place to help analyse these patterns. Identity is key to uncovering terrorism activities. We can monitor and trace the origin of the fund but to know who’s behind it is very tricky,” he said.

“We have all these equipment in place, but it’s still very hard to ‘crawl’ in the dark Web market,” the source added.

Malaysian criminologist P. Sundramoorthy said the consequences of militants or sympathisers switching to the use of cryptocurrency would be devastating as terror groups could be expected to execute attacks after receiving the funds.

“Given that cryptocurrency offers a high degree of anonymity and is popular and user-friendly, measures to control it must be put in place as soon as possible. They will always find a way to exploit such channels. We can’t eliminate the use but we need to limit it.”

Still, some experts say the issue might have been played up.

In a recent study by the Royal United Services Institute (Rusi), the British intelligence think-tank suggested that there is little link between cryptocurrency and terrorism. It said the claims that bitcoin is funding terrorism are greatly exaggerated.

Mr David Carlisle, an independent consultant with Rusi, said in a March 2 commentary: “Treating cryptocurrencies as an exceptional threat creates the misleading impression that more conventional financial products are not already equally, or more, vulnerable to terrorist exploitation.”

A regional security source acknowledged that most militants are indeed still channelling funds via conventional banking and money remittance services.

Still, it has been noticed that digitial currency has also been used as a means of transfer.

“We still see most of them funding their operations by taking personal loans, selling their belongings and so on. But to say the possibility of these militants turning to the dark Web is little or unlikely, that’s dangerous as we’re already seeing suspicious movements which we believe are terrorism fundings,” he said. “They will always try to find new ways to exploit technology to materialise their sick agenda.”

The danger of terrorist financing can be gleaned by the capture of Marawi in the southern Philippines by militants that ended in October after a five-month siege.

The Associated Press reported last month that Philippine military chief Eduardo Ano said at least US$1.5 million (S$2 million) was sent by terrorist group Islamic State in Iraq and Syria to finance militants planning the Marawi attack.

As Malaysia begins to impose controls over the growing use of digital currencies, Bank Negara Malaysia (BNM), its central bank, has required that conversions of cryptocurrencies into cash must be reported under the strict transactions under anti-money laundering laws.

Deputy Home Minister Nur Jazlan Mohamed said: “BNM has announced measures that would regulate the use of cryptocurrencies in Malaysia, especially the conversion of cryptocurrencies into cash and other equivalents. This measure will help the police and other enforcement agencies to manage terrorism financing.”

source: business.inquirer.net

Video game platform Steam no longer accepts bitcoin

Investors of the popular cryptocurrency bitcoin were certainly delighted as its stock value has risen exponentially these past few weeks.

But among those not too pleased was Valve’s popular gaming and digital distribution platform Steam, which recently disallowed bitcoin transactions due to its volatility and high fees.

In a recent blog post, Steam addressed the recent surge and explained why it won’t be able to support the alternative payment system much longer.

“In the past few months we’ve seen an increase in the volatility in the value of bitcoin and a significant increase in the fees to process transactions on the bitcoin network. For example, transaction fees that are charged to the customer by the bitcoin network have skyrocketed this year, topping out at close to $20 a transaction last week (compared to roughly $0.20 when we initially enabled bitcoin),” the announcement read.

“Unfortunately, Valve has no control over the amount of the fee. These fees result in unreasonably high costs for purchasing games when paying with bitcoin. The high transaction fees cause even greater problems when the value of bitcoin itself drops dramatically.”

Furthermore, since the cryptocurrency’s value keeps rapidly changing, Steam also had to make a lot of compromises in terms of purchasing.

Still, Steam is not closing its doors on possibly accepting the cryptocurrency once again in the future, stating: “The company adds that it may re-evaluate if accepting the cryptocurrency makes sense at a later date.”  Khristian Ibarrola /ra

source: technology.inquirer.net

Wall Street retreats from record as industrials, tech lag

NEW YORK - U.S. stocks declined on Monday as each of the major Wall Street indexes retreated from a record, weighed down by a drop in technology and industrial shares.

General Electric, down 6.3 percent, suffered its biggest one-day percentage decline in more than six years after a host of brokerages cut their price targets on the stock, citing higher chances of a dividend cut at the industrial conglomerate.

After holding near the unchanged mark for most of the session, losses accelerated late in the session on downturn in technology, off 0.40 percent.

Last week, the Dow and S&P managed to close at a record high all five days, after a strong start to third-quarter earnings and on hopes President Donald Trump's tax plans move forward after the Senate's approval of a budget resolution on Friday.

"On the one hand, the market is very extended, overbought, on the other hand so far earnings have come through," said Andrew Slimmon, portfolio manager at Morgan Stanley Investment Management in Chicago.

"The question becomes what happens if tax reform doesn’t happen in 2017, does the market sell off into the year-end?"

Investors are also waiting for news on the next Federal Reserve chief. Trump told reporters on Monday he is "very, very close" to making his decision on who should chair the Fed.

Of the 97 S&P 500 companies that have reported earnings so far, 73.2 percent have topped expectations, according to Thomson Reuters data, versus the 72-percent average for the past four quarters.

The Dow Jones Industrial Average fell 54.25 points, or 0.23 percent, to 23,274.38, the S&P 500 lost 10.19 points, or 0.40 percent, to 2,565.02 and the Nasdaq Composite dropped 42.23 points, or 0.64 percent, to 6,586.83.

Industrials, were off 0.8 percent as one of the biggest drags to the S&P of the 11 major sectors. Aside from GE, the group was also pulled lower by a 10.4-percent tumble in Arconic after the specialty metals maker missed profit estimates and announced a new chief executive.

The energy index stumbled 0.59 percent, driven by losses in Schlumberger, Baker Hughes and Halliburton, which reported results on Monday.

Hasbro plunged 8.6 percent after the toymaker's forecast for the holiday season fell below estimates as Toys'R'Us bankruptcy began to hurt its operations. Shares of peer Mattel fell 3.2 percent.

The S&P 500 posted 91 new 52-week highs and 6 new lows; the Nasdaq Composite recorded 104 new highs and 41 new lows.

About 5.84 billion shares changed hands in U.S. exchanges, compared with the 5.83 billion daily average over the last 20 sessions. — Reuters

Wall Street ends flat after Yellen; tech shares bounce

NEW YORK - The S&P 500 ended flat on Tuesday and the Nasdaq posted modest gains as technology shares bounced from sharp losses in the prior session and comments from Fed Chair Janet Yellen boosted expectations of a December rate hike.

Yellen said the Fed needs to continue gradual rate hikes and it would be imprudent to leave rates on hold until inflation reached the Fed's 2-percent target.

Earlier in the session, Atlanta Fed Chief Raphael Bostic, a non-voting member this year, said he would want "clear evidence" that prices were firming before committing to another rate increase, but did not rule out another hike in 2017.

Chances of a rate hike in December rose to 78 percent from about 40 percent a month ago, according to CME Group's FedWatch tool.

"Investors should be looking out for a December hike given we don’t know what happens to the Fed chair position next year. (Yellen), probably wants to be able to, knowing anyone new in that role might not feel comfortable tightening the first month," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.

Economic data showed U.S consumer confidence fell in September while home sales dropped to an eight-month low in August due to the impact of Hurricanes Harvey and Irma.

The Dow Jones Industrial Average fell 10.05 points, or 0.05 percent, to 22,286.04, the S&P 500 gained 0.23 points, or 0.01 percent, to 2,496.89 and the Nasdaq Composite added 9.57 points, or 0.15 percent, to 6,380.16.

Technology, up 0.4 percent, was the best performing major sector, recovering somewhat from losses in the prior session. Tech shares suffered their worst one-day drop in five weeks on Monday as concerns over tensions with North Korea prompted investors to book profits in what has been the best performing sector this year.

Apple rose 1.72 percent after four straight sessions of losses to help prop up the three major indexes, after Raymond James boosted its price target on the iPhone maker to $180 from $170.

"It is a little bit of a relief knowing perhaps investors still believe in buying the dips even after the Fed’s announcement of reduced balance sheet purchases," said Ablin.

President Donald Trump warned North Korea any U.S. military option would be "devastating" for Pyongyang, but said the use of force was not Washington's first option to deal with the North's ballistic and nuclear weapons program.

Darden Restaurants slumped 6.53 percent after the Olive Garden parent said it expected the negative effects on sales and earnings from Hurricane Irma to be about double that from Hurricane Harvey.

Red Hat rose climbed 4.09 percent after the Linux distributor's quarterly profit came in above estimates and the company raised its full-year forecast.

Advancing issues outnumbered declining ones on the NYSE by a 1.31-to-1 ratio; on Nasdaq, a 1.35-to-1 ratio favored advancers.

About 5.81 billion shares changed hands in U.S. exchanges, compared with the 5.96 billion daily average over the last 20 sessions. — Reuters

Asian shares droop, yen gains as Korean tensions rise

TOKYO - Asian shares slumped on Tuesday while the dollar remained off recent highs against the yen against the backdrop of rising tensions on the Korean Peninsula.

North Korea's foreign minister said on Monday that a weekend tweet by President Donald Trump counted as a declaration of war on North Korea and that Pyongyang reserved the right to take countermeasures, including shooting down US bombers even if they are not in its air space.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent in early trade, following losses on Wall Street.

Australian shares were up 0.1 percent, while South Korean shares were 0.3 percent down.

Japan's Nikkei stock index sagged 0.2 percent, pressured by a stronger yen.

"In addition to North Korea, the stronger yen is affecting shares today, and there's also Apple's poor performance, after the report that it told suppliers to reduce parts shipments," said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

Apple Inc shed 0.9 percent on Monday after it was reported the company had told suppliers to scale back shipments of parts for its upcoming iPhone X.

The dollar was slightly down against the yen at 111.70 and well shy of last week's two-month high of 112.725.

The yen tends to benefit during times of risk aversion due to Japan's net creditor status and the expectation that Japanese investors would repatriate assets when facing a crisis.

The euro edged up after tumbling on Monday following a severely diminished election victory for German Chancellor Angela Merkel that was accompanied by a surge in support for the far right.

Support for Merkel's conservatives unexpectedly slumped to its lowest since 1949 and the Social Democrats, partners in the outgoing coalition, said they would go into opposition.

The single currency was 0.1 percent higher at $1.1856 , while the dollar index, which tracks the greenback against a basket of six major rivals, was down 0.1 percent at 92.601.

Later on Tuesday, Federal Reserve Chair Janet Yellen is scheduled to speak on "Prospects for Growth: Reassessing the Fundamentals" at 1645 GMT.

On Monday, New York Fed President William Dudley said the US central bank is on track to gradually raise rates given factors depressing inflation are "fading" and the US economy's fundamentals are sound.

But Chicago Fed President Charles Evans said the Fed should wait until there are clear signs of faster wage and price growth before hiking rates again.

Crude oil prices gave back some of their gains after soaring more than 3 percent on Monday, with Brent hitting its highest in more than two years. Major producers said the global market was on its way to rebalancing, while Turkey threatened to cut oil flows from Iraq's Kurdistan region to its ports.

US crude eased 0.2 percent to $52.12 a barrel, after touching its highest levels since April on Monday. Brent crude edged up 0.1 percent to $59.10, after scaling its highest peak overnight since July, 2015. —Reuters

Wall Street edges up, shaking off healthcare, North Korea worries

NEW YORK - The S&P 500 closed slightly higher on Friday even though Apple was a drag, as worries about Washington's latest healthcare legislation proposal eased and investors shrugged off concerns about North Korea.

Investors in the broader market were also encouraged by a jump in the Russell 2000 small-cap index, which ended with a record high close.

After a volatile day the S&P's healthcare sector ended 0.1 percent higher as insurance stocks regained ground after Republican Senator John McCain said he opposed his Republican peers' latest effort to replace President Barack Obama's healthcare law.

The S&P technology sector managed to eke out a small gain as investors had more appetite for risk even with a decline of 1 percent in Apple shares on muted reactions to the iPhone maker's latest product launch.

"The removal of the healthcare overhang, the fact the North Korea market impact is dwindling and the move in the Russell 2000 has all the smart investors thinking that the grind higher continues," said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee.

The Dow Jones Industrial Average fell 9.64 points, or 0.04 percent, to 22,349.59, the S&P 500 gained 1.62 points, or 0.06 percent, to 2,502.22 and the Nasdaq Composite added 4.23 points, or 0.07 percent, to 6,426.92.

Some investors moved to safe-haven assets such as gold, after North Korea said it might test a hydrogen bomb over the Pacific Ocean in response to U.S. President Donald Trump's threat to destroy the reclusive country.

But others felt that the market would cope with the ongoing stand-off between the countries, which has been ratcheting up in recent months. "If you cry wolf enough it loses its impact in the end," Antonelli said.

Five of the 11 major S&P sectors ended the day lower and utilities led the decliners with a 0.7 percent loss. After falling as much as 0.5 percent, the healthcare sector ended 0.08 percent higher.

Earlier in the day concern about the Graham-Cassidy healthcare bill had wreaked havoc with insurers' stocks. UnitedHealth closed down 1.1 percent after falling as much as 3.6 percent earlier in the day.

The small telecom services index, with only four stocks, was the biggest percentage gainer with a 1.4 percent rise on consolidation speculation while the energy index rose 0.5 percent as oil futures settled higher.

T-Mobile gained 1 percent after Reuters reported that the cellphone network operator was close to agreeing tentative terms on a deal to merge with Sprint, whose shares jumped 6.1 percent.

The report also pushed up bigger rivals Verizon Communications and AT&T Inc, which could benefit from having one less competitor.

Advancing issues outnumbered declining ones on the NYSE by a 1.82-to-1 ratio; on Nasdaq, a 1.91-to-1 ratio favored advancers.

About 5.26 billion shares changed hands on U.S. exchanges compared with the 6.03 billion average for the last 20 sessions. — Reuters

Dollar clings to most of its gains as risk sentiment improves

TOKYO — The dollar held on to most of its gains on Tuesday, following a sharp rebound on improving investor risk sentiment as worries over North Korea and Hurricane Irma receded.

The dollar index, which tracks the greenback against a basket of six major rivals, was steady at 91.874, after it skidded to a 2-1/2-year low of 91.011 on Friday.

The euro was little changed at $1.1955 after shedding 0.7 percent overnight. The common currency reached $1.2092 on Friday, its highest since January 2015, as the dollar suffered a broad retreat.

Higher US Treasury yields also bolstered the dollar, as the benchmark US 10-year note yield rose to 2.135 percent from its close of 2.125 percent on Monday, and 2.061 percent on Friday.

"Some people said the dollar's fall and recovery was not strange, since US yields got so low," said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo.

"But the market is still sensitive to risk-off news, maybe from North Korea, or from disappointing US economic data," he said. "So that's why the dollar is still struggling to find its way."

The dollar was steady at ¥109.39 after rallying 1.4 percent on Monday, its biggest one-day surge since mid-January.

It had slumped to a 10-month low of ¥107.320 on Friday, when Hurricane Irma threatened Florida and as financial markets braced for the possibility of another missile or nuclear test to mark North Korea's founding day on Sept. 9. The yen tends to benefit during times of economic and political uncertainty due to Japan's net creditor nation status.

But Pyongyang's anniversary passed without further tests, and Irma lost strength and was downgraded to a tropical storm after battering Florida over the weekend.

"Receding fear over Hurricane Irma and North Korea was a key factor behind the dollar's bounce. Market focus is likely to return to fundamentals, although there aren't many major events scheduled this week that could decide the direction for currencies," said Shin Kadota, senior strategist at Barclays in Tokyo.

Major US allies in Asia welcomed on Tuesday the UN Security Council's unanimous vote to step up sanctions on North Korea, with its profitable textile exports now banned and fuel supplies to the reclusive North capped after its sixth nuclear test.

The Swiss franc, often sought in times of global risk aversion along with the yen, was flat at 0.9560 per dollar. The franc had rallied to a two-year high of 0.9421 on Friday.

The pound edged up 0.1 percent to $1.3175 after losing 0.25 percent on Monday.

Sterling fared better against the euro, brushing a fresh one-month high of 90.83 pence, aided by speculation that the Bank of England may sound more hawkish on interest rates in defense of the currency at its policy meeting on Thursday.

The Australian dollar was 0.2 percent lower at $0.8015, extending its retreat from a two-year peak of $0.8125 scaled on Friday.

The Chinese yuan pulled further away from Friday's 21-month high against the dollar of 6.5432, after China's central bank on Monday lifted measures put in place to support the yuan when it came under selling pressure. — Reuters

US jobs machine keep stock market humming

World stock markets were mostly higher Friday as investors welcomed strong US jobs data which all but sealed a Federal Reserve rate hike next week.

Wall Street and most European equity markets traded firm in response to the American economy generating 235,000 new jobs in February, well above what economists had forecast.

This was the missing piece of the puzzle Fed watchers were waiting for to make tighter credit a near-certainty when the US central bankers meet next week.

Lower-than-expected wage rises kept a few doubts alive, but mostly the jobs report hit the spot, analysts said.

Upbeat New York helped key European markets hold onto most of their early gains. London and Paris were up at the end of European trading, but Frankfurt slipped a smidgen into negative territory just before the closing bell.

Earlier, Japan’s Nikkei jumped 1.5 percent, with declines in the yen boosting exporters.

“Today’s US jobs report was more than adequate to justify a rate hike next week,” said Craig Erlam at Oanda.

‘Won’t bottle it’

“The only thing standing in the way of a rate hike now is the Fed itself,” he said, “but after its efforts over the last few weeks, surely even it won’t bottle it now.”

Higher interest rates are not in themselves reason for cheer in the stock market as borrowing costs rise, but analysts said rate rises are a much-needed token of Fed confidence in the US economy in times of uncertainty, including over President Donald Trump’s economic program.

“After all, monetary policy is set to be tightened further against the backdrop of strengthening US and global economies,” said Oliver Jones at Capital Economics.

Investors are “still unwilling to bet against higher prices despite strong odds of a rate increase in the US next week,” LCG analyst Jasper Lawler said of global stock markets.

Elsewhere, oil prices were back on a slippery slope, having earlier Friday recovered ground after sharp mid-week losses. US oil prices dropped 79 cents to $48.49 per barrel, its lowest level since late November.

Worries about a global supply glut, increased US production and questions about an OPEC-Russia led drive to cut output are keeping oil traders on edge.

Key figures around 2200 GMT

New York – Dow: UP 0.2 percent at 20,902.98 (close)
New York – S&P 500: UP 0.3 percent at 2,372.60 (close)
New York – Nasdaq: UP 0.4 percent at 5,861.73 (close)
London – FTSE 100: UP 0.4 percent at 7,343.08 (close)
Frankfurt – DAX 30: DOWN 0.1 percent at 11.963.18 (close)
Paris – CAC 40: UP 0.2 percent at 4,993.32 (close)
EURO STOXX 50: UP 0.3 percent at 3,420.54
Tokyo – Nikkei 225: UP 1.5 percent at 19,604.61 (close)
Hong Kong – Hang Seng: UP 0.3 percent at 23,568.67 (close)
Shanghai – Composite: DOWN 0.1 percent at 3,212.76 (close)
Euro/dollar: UP at $1.0672 from $1.0576 Thursday
Pound/dollar: UP at $1.2169 from $1.2162
Dollar/yen: DOWN at 114.78 yen from 114.98 yen
Oil – Brent North Sea: DOWN 82 cents at $51.37 per barrel
Oil – West Texas Intermediate: DOWN 79 cents at $48.49 per barrel

source: business.inquirer.net