International News Bradley Associates Blog - Asian Markets Hit by US Losses, Europe Warning

Carthrine Wilsons
2
7 views
  • About
  • Export
  • Add to
http://www.thejakartaglobe.com/business/asian-markets-hit-by-us-losses-europe-warning/586556

Asian markets took a hit on Thursday after losses on Wall Street, while dealers were also put off by a warning from Germany’s central bank that Europe’s debt crisis could continue for a decade.

Gold slipped slightly as traders remained bearish on the precious metal, which suffered its heaviest loss in 30 years on Monday after disappointing Chinese economic growth data.

Tokyo fell 1.22 percent, or 162.82 points, to 13,220.07, Seoul shed 1.24 percent, or 23.78 points, to 1,900.06 and Sydney slipped 1.60 percent, or 80.2 points, to 4,924.4.

In the afternoon Hong Kong lost 0.16 percent but Shanghai was 0.10 percent higher.

US markets suffered their second big fall in three days on Wednesday, pulled down by a dive in Apple shares.

Apple fell 5.5 percent to below $400 for the first time since late 2011 after one of its US suppliers slashed its profit guidance, which analysts said indicated slow iPhone and iPad sales.

Adding to the downbeat sentiment in New York was Bank of America’s below-forecast earnings for the January-March quarter.

The Dow fell 0.94 percent, the S&P 500 dropped 1.43 percent and the Nasdaq lost 1.84 percent.

On forex markets, the dollar was trading at 98.10 yen in afternoon trade, against 99.19 yen in New York late Wednesday.

The euro fetched $1.3050 and 128.00 yen, against $1.3033 and 127.97 yen.

In Europe, Jens Weidmann, head of Germany’s Bundesbank and a member of the European Central Bank’s council, said in an interview that the region’s debt woes could last for another 10 years.

“Overcoming the crisis and the crisis effects will remain a challenge over the next decade,” Weidmann told the Wall Street Journal.

Commodities resumed their recent slide fuelled by Monday’s Chinese data that showed the economy grew 7.7 percent in the January-March first quarter, slower than the previous three months and below expectations.

The figures raised doubts about the country, a key driver of global growth and the biggest energy consumer in the world.

Gold slipped to $1,375.10 an ounce at 0300 GMT, compared with $1,383.90 late on Wednesday in Asia. However, it was higher than the two-year lows around $1,340 seen on Monday, when it slumped 10 percent — its biggest fall since 1983.

It had also suffered a fall of around five percent on Friday.

“The whole drama started last Friday with the start of the move in gold, and since then it’s been like a contagion spreading across the markets,” said Ker Chung Yang, investment analyst at Phillip Futures in Singapore.

“China’s growth just added to the misery, as people are accepting they’re not going to get 8 percent [economic growth] in the next couple of quarters.”

Oil prices also slipped, with New York’s main contract, light sweet crude for delivery in May, down six cents at $86.60 a barrel and Brent North Sea crude for June shedding 12 cents to $97.57.

0 comments