Asia stocks to track US slide, Treasuries rise

October 18, 2018 | By | Reply More

Grab latest promotion at LAZADA now!

SYDNEY: Asian stocks are on course for a further losses following a weak US equity session as investors fretted over lofty expectations for earnings and the trade war’s impact on growth amid rising interest rates. Treasuries and the yen gained.

Futures pointed to losses for shares in Japan and Hong Kong after the S&P 500 Index fell more than 1% and the Nasdaq 100’s drop topped 2%.

Chinese stocks are also seen falling as losses this week brought the slide in its major benchmark to 30% since a January high amid concern about the weakening yuan and policy responses to slowing growth.

Next up comes third-quarter GDP for China on Friday in addition to retail sales and factory output data. The dollar touched the highest in more than a week, while the 10-year Treasury yield fell to 3.18%.

Earnings misses from several US industrial firms and a Bank of America downgrade of the housing sector fuelled worries that higher interest rates and the trade war are hitting profits.

Weak results from Germany’s SAP and Taiwan Semiconductor dragged American tech indexes lower. Also helping to dampen appetite for risk was Italy’s debt crisis.

The spread between Italian and German bond yields hit the highest level since 2013 as European Union officials questioned the country’s budget plan.

Investors are also assessing the age of the business cycle, with the chance of the US tipping into a recession in the next two years now greater than 60%, according to JPMorgan Chase & Co.

In China, Friday’s GDP data is expected to show an economic expansion at 6.6% from a year earlier, according to a Bloomberg survey, while industrial production probably rose 6%, indicating steady growth.

Elsewhere, oil slipped to the lowest level in nearly a month after expanding American stockpiles overshadowed tensions between the US and Saudi Arabia over the disappearance of a prominent kingdom critic.

FREE RM12.70 credit upon sign up to discover and book amazing travel experiences with Klook.

Category: News

About the Author ()

Leave a Reply