BROWSE

EMERGING MARKETS-Asian stocks spooked by U.S. inflation spike; Taiwan stocks extend slide | Reuters

Asian equities fell on Thursday after data showing a jump in U.S. inflation reinforced fears that the Federal Reserve would raise interest rates sooner than planned, while Taiwan's stocks slumped for a third session on fears of a COVID-19 resurgence. Currencies were also broadly weaker as the U.S. dollar stood tall following the inflation data, with the South Korean won down 0.5% to a six-week low, while the Thai baht was off 0.4%. Markets in India, Indonesia, Malaysia, Singapore and the Philippines were closed for the Eid festival. Overnight, U.S. stocks tumbled after data showed consumer prices increased by the most in nearly 12 years last month, raising bets of a Fed rate hike as early as December next year. Higher U.S. rates put pressure on Asian markets, which yield-seekers usually prefer given their relatively higher interest rates. Furthermore, resurgences of COVID-19 would make it harder for Asian central banks to match a potential rate-hike cycle in the United States. "Rising U.S. bond yields and a budding global risk-off move will likely trigger a rebound in the greenback," analysts at BCA Research wrote. "The outlook for EM financial assets remains troublesome and we continue underweighting EM equities and credit versus their developed market peers." Shares in Taipei ended 1.5% lower despite reports that the island's finance ministry called state-owned banks to "suggest" they buy stocks amid steep falls in the stock market, according to Reuters sources. The index fell 4% on Wednesday after authorities warned that Taiwan could face tighter restrictions that would shut non-essential businesses, after a rise in new domestic COVID-19 infections earlier this week. In the previous two sessions, the stock index lost nearly 8%. By April-end, it had clocked a massive 100% rise from lows touched in March last year, as demand for its electronics exports skyrocketed due to the shift to working from home. HIGHLIGHTS ** Equities in Thailand fell nearly 1%, with energy firms PTT down 0.6% and Gulf Energy Development down 1.5% ** Thailand's 10-year government bond yields are up 2 basis points at 1.68%​​, while the 3-year benchmark yield is up 1 basis point at 0.57%​​ ** Japanese stocks decline 2.5% to a 4-month low; SoftBank Group tumbles as tech shares come under pressure Asia stock indexes and currencies at 0642 GMT COUNTRY FX RIC FX FX INDE STOCKS STOCK DAILY YTD % X DAILY S YTD % % % Japan +0.05 -5.79 <.N2 -2.49 0.01 25> China <CNY=CFX +0.11 +1.20 <.SS -1.13 -1.43 S> EC> S.Korea <KRW=KFT -0.41 -3.82 <.KS -1.25 8.65 C> 11> Taiwan -0.09 +1.80 <.TW -1.46 6.36 II> Thailan -0.35 -4.37 <.SE -0.96 7.41 d TI> (Reporting by Rashmi Ashok in Bengaluru; Editing by Subhranshu Sahu)

Comments are closed.