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Asia stocks shake off US tech slump

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Syndicated News
Written by Syndicated News
SINGAPORE, June 13 2017 : Asian stocks crept higher today, defying a weak lead from Wall Street, which was dragged lower by technology stocks for a second day, while the Canadian dollar soared on the possibility interest rates might go up sooner than expected.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1 percent in early trade.

Japan’s Nikkei .N225 slipped 0.3 percent.

South Korea’s KOSPI .KS11 gained 0.3 percent, with the biggest stock Samsung Electronics (005930.KS) flat after Monday’s 1.6 percent slump. Naver Corp. (035420.KS) and LG Innotek (011070.KS), which led Asian losses yesterday, also recovered.

On Wall Street, tech giants including Apple (AAPL.O), Alphabet (GOOGL.O), Facebook (FB.O) and Microsoft (MSFT.O) continued to be sold off for the second consecutive day.

That dragged the Nasdaq .IXIC down 0.5 percent, the S&P 500 .SPX 0.1 percent and the Dow Jones Industrial Average .DJI 0.2 percent.

“I don’t sit in the camp that we will see a prolonged pullback in U.S. tech, but there is a good chance this hot sector now underperforms and I had been suggesting increasing exposure to U.S. financials as a trade,” Chris Weston, chief market strategist at IG in Melbourne, wrote in a note.

In currencies, the Canadian dollar CAD= held on to yesterday’s strong gains, after a Bank of Canada official said the central bank would assess if it needs to keep interest rates at near-record lows as the economy grows. That was a change in tone for the central bank, which said earlier this year that rate cuts remain on the table.

The so-called loonie strengthened about 0.1 percent to trade at C$1.33 to the dollar, extending yesterday’s 1.1 percent gain.

“It feels like a long time since markets have been treated to unscheduled hints of tightening, and this was quite apparent when you saw the positive reaction of CAD crosses overnight,” Matt Simpson, senior market analyst at ThinkMarkets in Melbourne, wrote in a note.

The dollar failed to make up losses against the yen JPY= ahead of a widely expected interest rate increase by the U.S. Federal Reserve this week. It was flat at 109.95 yen, after falling 0.4 percent yesterday.

The dollar index, which tracks the greenback against a basket of trade-weighted peers, was marginally higher at 97.177.

The euro EUR=EBS inched lower to $1.12.

In commodities, oil advanced on signs of inventory declines in the United States and news that Saudi Arabia would limit volumes of crude to some Asian buyers in July and deepen cuts to the U.S. market.

U.S. crude CLc1 rose 0.3 percent to $46.19 a barrel.

Global benchmark Brent added 0.2 percent to $48.41. – Reuters

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Syndicated News

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