Par Andrew Galbraith
SHANGHAI (Reuters) – Asian stocks slipped on Friday, with a regional equity gauge set for its biggest monthly decline since the strongest of global pandemic lockdowns last March, while the dollar trailed near a low in ‘one month compared to expectations for a continuation of the Fed’s stimulus.
But the stock market losses were moderate compared to sharp declines earlier in the week that were triggered by investor fears about the impact of regulatory measures in China on the education, real estate and financial sectors. technology.
Assurances from Chinese regulators and state media have helped ease investors’ nerves, as have statements from the US Federal Reserve that its bond buying program will remain unchanged for now. The United States posted strong growth in the second quarter thanks to increased vaccinations and government assistance, but the expansion fell short of expectations.
US earnings and robust forecasts also helped Wall Street reach intraday highs on Thursday.
On Friday, the largest MSCI index of Asia-Pacific stocks excluding Japan fell 0.84%, taking its losses for the week to over 6.5%. plunged 1.71%, set for an 11th consecutive month of decline on the last trading day of the month.
Chinese blue chips fell 0.96% and Hong Kong’s fell 1.27% as tech stocks lagged again. The Hang Seng Tech Index widened its losses for the week to over 17%. Seoul’s Kospi was down 0.94% for the last time on the day.
“It is clear that investors are very shaken by the regulatory crackdown,” said Michael Frazis, portfolio manager at Frazis Capital Partners in Sydney, adding that the market continues to face other pressures in the near term.
“You’re going to talk about phase-down, and you’ve got a lot of coronavirus beneficiaries who are largely in the tech industry. Growth will be slow, and they will report numbers on very high bases for this period last year… We expect the technology indices to be called into question in the short term, but we are very optimistic in the medium and long. term. “
Lower than expected earnings reported by Amazon.com Inc (NASDAQ 🙂 Thursday, and the company’s expectations of slower sales growth in the coming quarters weighed on US equity futures at the start of the day. Asian negotiation.
Futures on the Nasdaq e-mini slipped 1.35% and fell 0.82%.
THE DOLLAR IN THE CLOGGING
After rising Thursday on US economic growth data, US Treasury yields fell, particularly towards the long end of the yield curve.
The 10-year benchmark bonds last returned 1.2509%, down from 1.269% on Thursday night, and the 30-year yield stood at 1.9001%, down from 1.916% on Thursday.
The spread between US 10-year and 2-year rates narrowed to 104.5 basis points.
“We believe bond yields now rule out an unduly pessimistic view of the medium to long term outlook … The outlook for a robust recovery – and higher bond yields – is arguably much better,” Capital Economics analysts said. in a customer note.
But following Fed Chairman Jerome Powell’s statement earlier this week that rate hikes are “far away” and that the labor market still has “some ground to cover,” the dollar wallowed near its one-month low on Friday and was set for its worst week since May.
The latter rose 0.09% to 91.967, with the euro edging down to $ 1.1879. The greenback was barely higher against the yen at 109.50.
In commodities markets, oil prices fell after the global benchmark surpassed $ 76 a barrel due to limited supplies from the United States.
Brent fell 0.53% to $ 75.65 a barrel and US West Texas Intermediate crude traded 0.52% to $ 73.24.
was stable at $ 1,827.94 per ounce.