Asian markets hit by Central Bank signals to end low rates

1 July 2017 12:01 am - 0     - {{hitsCtrl.values.hits}}

A A A

AFP: Asian markets went into reverse yesterday after Wall Street and Europe suffered hefty losses in response to Central Banks’ signals that the end to the era of cheap money was drawing near.
After years of loose monetary policies designed to propel global economies out of the financial crisis, improving growth and easing unemployment have allowed banks to start flagging tightening measures, including interest rate hikes. While the upbeat outlook is welcomed as a sign of optimism,  Asian markets rallied on Thursday, there are concerns the world economy cannot withstand a more stringent borrowing environment. Wall Street’s three main indexes ended deep in the red, while European stocks were also well down on Thursday. The selling seeped through to Asia with heavy losses in technology firms continuing while banks were hit by profit-taking. Tokyo ended 0.9 percent lower, Hong Kong fell 0.8 percent, Sydney sank 1.7 percent and Singapore shed 0.6 percent. 
Wellington, Taipei and Bangkok were also well down. Shanghai reversed early losses to end up 0.1 percent following data showing a forecast-beating jump in an index of Chinese manufacturing. 

The official reading of the purchasing managers’ index indicated the world’s number two economy was stabilising, although analysts voiced concerns about an ongoing growth slowdown.
In early European trade London fell 0.2 percent, Paris added 0.1 percent and Frankfurt was flat.
“It’s the wild swings we are starting to see that worry me the most,” said Greg McKenna, chief market strategist at AxiTrader.
“Volatility begets volatility and the chances of a very big dip are growing.” 
There is also fading optimism that President Donald Trump will be able to push through promised market-friendly growth programmes as he struggles to garner support for his health care bill despite controlling both houses of Congress.
The shift by central banks out of their easy-money policies led by Britain, the European Central Bank and Canada has also weighed on the dollar.
For years the greenback has benefited from a divergence between the Federal Reserve’s move to higher rates including rate hikes this year and other regions. But analysts said the mood was changing.
“A game changer of a week as hawkish central bank commentary steamrolled the markets,” said Stephen Innes, senior trader at OANDA.
“Traders are now contemplating who will be next to join the line-up. No one wants to miss out on this party realising there’s a co-ordinated policy shift afoot and the chance to catch the removal of an easing bias is far too seductive for traders to ignore.”
Talk of tighter ECB rates has pushed the euro to more than one-year highs while the pound has also benefited, despite political uncertainty in Britain. Both currencies dipped in Asia but held on to most of their recent gains.

 

See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

 

  Comments - 0

See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

 

 

Add comment

Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Reply To:

Name - Reply Comment




Army’s LRRP Ambush of LTTE’s Military Intelligence Chief

A news report in the Dailymirror last August stated that the Long Range Recon

“I don’t think Sri Lankans can be realistically ruled by force” -Ahimsa Wickrematunge

Twelve years after the assassination of Lasantha Wickrematunge, the founding

Decisions to be made in Sri Lanka’s hunt for the COVID-19 Vaccine

Around the world, governments are gearing up to roll out nationwide immunizat

“I am the Godfather of Russian tourists” - Udayanga Weeratunga

Former Sri Lankan Ambassador to Russia Udayanga Weeratunga is back in the sce

See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

 

 


MIRROR CRICKET