×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Asian stocks, dollar subdued after cautious Fed

Asian stocks, dollar subdued after cautious Fed
Comment E-mail Print Share
First Published: Thu, Feb 10 2011. 08 41 AM IST
Updated: Thu, Feb 10 2011. 08 41 AM IST
Sydney: Asian stock markets fell on Thursday, while the dollar struggled to make much headway after the US central bank chief signalled the recovery in the world’s biggest economy was still fragile and warned against sharp spending cuts.
Commodity prices including crude oil were subdued after Federal Reserve chairman Ben Bernanke suggested US economic conditions were still too weak for the central bank to pull back on its vast monetary stimulus, despite a welcome drop in the jobless rate.
Japan’s Nikkei slipped, while shares elsewhere in Asia slid 0.7%.
Hong Kong’s Hang Seng index and South Korea’s KOSPI have completely erased this year’s gains and were back at levels not seen since late December.
In contrast, last year’s laggards like the Nikkei remained well in the black for the year.
“It’s not like buying in Japanese stocks has completely stopped, but investors have been looking for a reason to take profits and now they’re cautious about overheating in the market,” said Norikazu Kitta, strategist at Nikko Cordial Securities.
Despite the generally downbeat mood, there were patchy bright spots in the market, among them, shares in Australian bourse operator ASX jumped more than 4%, while Singapore Exchange gained about 1.6%.
Investors are hoping that merger news between major bourses like the NYSE Euronext and Deutsche Boerse would boost prospects of ASX’s own planned merger with Singapore Exchange, which is facing political hurdles.
Global miner Rio Tinto edged up 0.3% ahead of its December-half results. Investors, however, pushed SingTel shares down 1 percent after the telecom company unveiled a 2.2% fall in quarterly profit.
DOLLAR SUBDUED
Meanwhile, the dollar index , which tracks the greenback’s performance against a basket of major currencies, limped up 0.06% to 77.690 after a steep decline overnight.
Still, many traders think the dollar is in a holding pattern for the near term as the euro was also lacking upward momentum of its own after the European Central Bank last week quelled expectations of an early rate hike.
The euro traded at $1.3715 , down slightly from late US levels but still up about 1% on the week.
“It’s difficult for now for the euro to rise above the peak hit earlier this month. It will need a fresh factor to go beyond that peak,” said Keiji Matsumoto, a strategist at Nikko Cordial Securities.
The Australian dollar dipped slightly in the wake of solid jobs numbers as investors bet they were not so strong as to make a rate rise more likely anytime soon.
US crude was little changed at $86.83 a barrel, while gold edged lower to $1,361.55 an ounce, well off a lifetime high around $1,430 hit in December.
Copper, which hit an all-time high of $10,160 per tonne on Monday, traded at $9,988.
Comment E-mail Print Share
First Published: Thu, Feb 10 2011. 08 41 AM IST
More Topics: Asia | Finance | Banks | Dow Jones | Stocks |