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Asian shares fall on Libya; oil trims gains

Asian shares fall on Libya; oil trims gains
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First Published: Wed, Feb 23 2011. 08 51 AM IST
Updated: Wed, Feb 23 2011. 08 51 AM IST
Singapore: Asian stocks fell on Wednesday, following Wall Street’s worst performance since August, and oil trimmed huge gains after the revolt against Libyan leader Muammar Gaddafi scared investors and reduced crude output in Africa’s third-largest producer.
Popular protests in Libya’s neighbours Egypt and Tunisia have toppled entrenched leaders, but a defiant Gaddafi said he would not be forced out by the deadly unrest sweeping his vast nation.
The turmoil in Libya, which pumps nearly 2% of world oil output, sent London Brent crude prices above $108 a barrel to a 2-1/2 year high but they settled below $106 on Tuesday as the Organization of the Petroleum Exporting Countries (OPEC) said it would act should there be a supply shortage.
US crude futures eased slightly on Wednesday. NYMEX crude for April delivery was down 11 cents at $95.31 a barrel. The contract earlier rose as high as $96.08, the highest for any nearby month since October 2008.
Japan’s Nikkei 225 index was down 0.26% and the MSCI’s index of Asia Pacific shares outside Japan was off 0.14%.
Gold , a traditional safe haven in times of trouble, fell to $1,395, breaking a six-session rally, as the Libya turmoil prompted bullion investors to take profits.
Currencies viewed as safe havens, such as the yen and Swiss franc, have also been boosted by events in Libya.
The dollar traded around 0.9375 Swiss francs , not far off a three-week low around 0.9362 plumbed overnight. The euro fell to a 3-1/2 week low at 1.2782 francs and last stood around 1.2830.
The euro was at $1.3685, after having briefly risen as high as $1.3704 on EBS following hawkish comments from European Central Bank officials.
Wall Street stocks on Tuesday suffered their worst day since August in what could be the start of a long-anticipated pullback after gaining more than 20% in the past six months.
The Dow Jones industrial average closed down 1.44%. The Standard & Poor’s 500 Index fell 2.05%. The Nasdaq Composite Index dropped 2.74%.
Heavy volume and rising volatility gave credence to a significant correction to the uptrend which has seen stocks double from their March 2009 lows in the past two years.
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First Published: Wed, Feb 23 2011. 08 51 AM IST
More Topics: Markets | Global | Asia | Libya | Protests |