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Asia stocks retreat after week-long Trump rally

18 February 2017 12:01 am - 0     - {{hitsCtrl.values.hits}}


AFP - Most Asian markets eased further yesterday as investors cashed out following a healthy run-up since last week, and after Wall Street’s Trump-fuelled surge finally came to an end.
Equity markets around the world are sharply higher since the US president last Thursday pledged a ‘phenomenal’ tax reform package soon, raising hopes he would press on with plans to fire up the US economy.
The remarks were the spark for all three main Wall Street indices to hit record highs for five successive days, with help also coming from Federal Reserve boss Janet Yellen’s upbeat assessment of the outlook for the US and hints at a March interest rate hike.
However, analysts said despite the bright week for markets there remained a lot of uncertainty, particularly with Trump’s first weeks in office engulfed in controversies, most recently over his relationship with Russia.
“The current political landscape is unlikely to change soon, nor will the debates surrounding tax, fiscal and Fed policies,” said Stephen Innes, senior trader at forex firm OANDA.

“As such we should expect the markets to come under renewed pressure and to be severely tested in the weeks to come,” he said in a commentary.
Hong Kong stocks - which this week hit highs not seen since summer 2015 - fell 0.3 percent while Shanghai shed 0.9 percent by the close. Sydney eased 0.2 percent and Seoul dropped 0.1 percent, while Tokyo lost 0.6 percent.
But Singapore rallied 0.4 percent following data that showed the city-state’s economy grew at its fastest pace in five years during October-December.
In early European trade London and Paris each lost 0.1 percent and Frankfurt was flat.
The dollar was also struggling to break out against its major peers despite Yellen’s comments this week to Congress that the economy continued to improve and left open the chance of a March rate hike.
The greenback climbed around three percent from its levels just before Trump’s tax comments to flirt with the 115 yen mark Thursday. But it retreated in New York and was sitting at 113.34 yen in early Asia trade.
In company news, Seoul-listed Samsung Electronics sank 0.6 percent following news that the heir to the tech giant had been arrested as part of a probe into corruption and influence-peddling that caused South Korea President Park Geun-Hye to be impeached. And in Japan troubled conglomerate Toshiba plunged again after Standard & Poor’s warned it may cut its credit rating, while the head of a possible saviour, Mitsubishi Heavy Industries, reportedly ruled out any rescue deal.
The firm dived 9.2 percent yesterday, taking its losses for the week to more than 20 percent as investors fret over multi-billion-dollar losses and possible accounting fraud at its US nuclear arm Westinghouse Electric.



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