Ahead of US PCE Data, Asian Stock Rally Fails – Asia Market Wrap
Asian shares slumped after a disappointing session on Wall Street, which impacted on tech companies and Treasuries, with investors looking forward to the publication of vital US inflation data later on Friday.
MSCI’s Asian share index fell as much as 0.7%, but was still on track for a second consecutive weekly gain. Following a big gain the day before, Japanese indexes led the region’s losses. US futures edged higher. That comes after the S&P 500 gained 0.1% on Thursday as Treasury yields rose.
The Yen rose against the Dollar, while Japanese bond futures moved down after people familiar with the situation indicated BoJ officials are prepared to raise interest rates at their policy meeting later this month, assuming no major shocks to the economy or financial markets in the meantime. India’s central bank reduced its benchmark rate as expected.
The drop in equities demonstrated that risk sentiment remained fragile, despite the fact that global stocks had recovered in the last two weeks to within 1% of a record closing high set in late October. Those gains reflected softening concerns about tech valuations as well as increased confidence among traders that the Fed will drop interest rates by 25 bps next week at its final meeting of the year.
The Dollar index slipped lower in Asia on Friday, on track for its fourth weekly fall in five. Bitcoin fell below $93,000, while silver and gold climbed. Following the policy announcement, India’s 10-year bond yields decreased and equities continued to rise.
