Sunday , June 26 2022

Asian stocks are nervous amid fears of inflation, the dollar a year high


  • Mon about 3 years maximum against yen; 1 year maximum vs basket of teammates
  • Oil prices are falling, but are still close to multi-year highs
  • Investors waiting for Chinese trade, US CPI figures
  • Most Asian stock markets dominated, Hong Kong closed for typhoon

HONG KONG, Oct 13 (Reuters) – Asian equities were on the brink on Wednesday as worries about rising energy prices fueling inflation weighed on sentiment and boosted expectations that the United States they would reduce their emergency bond purchase program, keeping the dollar at a maximum of one year.

MSCI’s broader Asia-Pacific stock index outside of Japan (.MIAPJ0000PUS) rose 0.1% in early operations, remaining stable after falling more than 1% the day before , in what was his worst daily performance in three weeks.

Movements were silenced in most markets. Chinese blue chips (.CSI300) were flat, Australia (.AXJO) gained 0.06% of gain, while Japanese Nikkei (.N225) lost 0.2%.

The Hong Kong stock exchange closed in the morning due to a typhoon.

Also contributing to the unrest, investors expect a series of data releases to be released on Wednesday, including Chinese trade figures, U.S. consumer price inflation data and the minutes of the Federal Reserve’s September political meeting of the United States.

The imminent start of the company’s profit season also deterred some investors from making big bets.

“This week, inflation outperforms almost everything else, because that pushes the Fed’s expectations one way or another and that’s so dominant,” said Stefan Hofer, LGT’s chief investment strategist at the ‘Asia Pacific.

“This earnings season is also critical because in the previous one, profits, especially in the US, were very strong, in part because of the base effect. The third quarter may be a little more standard,” he added.

The U.S. Federal Reserve is slowly getting closer to starting to reduce its program to massively buy pandemic relief bonds, a decision that is compounded by growing fears around the world that l ‘Rising energy costs will lead to inflation while reducing economic recovery.

Currently, oil prices are close to multi-year highs, but were more stable in the Asian morning trade.

Brent crude fell 0.29% to $ 83.18 a barrel, just above Monday’s three-year high of $ 84.6, while U.S. crude fell 0.2%. to $ 80.48, compared to Monday’s seven-year high of $ 82.18.

Despite growing inflation concerns, there is growing optimism about the state of the economic recovery. Three U.S. Federal Reserve policymakers said Tuesday that the U.S. economy has recovered enough for the central bank to begin withdrawing its support from the crisis era. Read more

As a result, shares fell on Wall Street overnight. The Dow Jones industrial average (.DJI) fell 0.34%, the S&P 500 (.SPX) lost 0.24% and the Nasdaq Composite (.IXIC) fell 0.14%.

The decrease in probability also meant that the dollar was strong, standing just below the one-year high against other majors reached the day before.

The dollar index stood last at 94,413, just above Tuesday’s high of 94,563, the highest since September 2020.

It was particularly strong against the yen, with a dollar that bought 113.39 yen, in view of Monday’s three-year low. As Japan buys most of its oil abroad, a yen week means it is struggling even more with high prices.

Gold held ahead of U.S. data, with a spot price above 0.04%, to $ 1,760 an ounce, mid-range this month.

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