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Friday, September 18, 2020

Asia shares sluggish after Wall Street’s tech-inspired rally

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.19%, to sit not far short of its pre-pandemic late January high.

By: Reuters | Hong Kong/new York | August 18, 2020 10:19:29 am
GLOBAL MARKETS - Asia shares consolidate, China cuts another interest rate, asina market news, global market news update, world market news update, business news india, indian express business newsPeople walk past an electronic board showing Hong Kong share index outside a bank in Hong Kong, Thursday, Feb. 28, 2019. (AP Photo/Kin Cheung)

Asian stocks inched up on Tuesday as Sino-US tensions weighed on optimism generated by Wall Street’s tech-driven rally, while the dollar dropped against almost all major currencies.

The Trump administration announced on Monday it would further tighten restrictions on China’s Huawei Technologies Co, aimed at cracking down on its access to commercially available chips.

MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.19%, to sit not far short of its pre-pandemic late January high.

Japan’s Nikkei dipped 0.52%, while most markets traded in a narrow band with Chinese blue chips dropping 0.25%. The Australian benchmark index rose 0.12%.

E-Mini futures for the S&P 500 were flat.

The Nasdaq surged to a record high close on Monday and the S&P 500 approached its own record level, with both indexes lifted by technology stocks.

“We saw some strength in tech again with semiconductors driving the boat,” Thomas Hayes, chairman at Great Hill Capital said of the US rally.

The US dollar softened against most currencies after disappointing manufacturing and mortgage data, Commonwealth Bank of Australia analyst Joseph Capurso wrote in a
note.

But moves were small ahead of Wednesday’s release of the Federal Reserve minutes, with speculation that the Fed will adopt an average inflation target, which would seek to push inflation above 2% for some time.

Bitcoin hovered near the 13 month high it hit on Monday.

On the commodities front, oil prices edged lower on Tuesday, but still mostly held onto overnight gains after OPEC+ said the producer grouping was almost fully complying with output cuts.

Brent crude was down 6 cents, or 0.1%, at $45.31 a barrel, after gaining 1.3% on Monday. US crude was down 0.2%, at $42.81 a barrel, having risen 2.1% in the previous session.

Safe haven gold closed higher after Berkshire Hathaway also disclosed a stake in Toronto-based Barrick Gold Corp, one of the world’s largest mining companies.

Spot gold added 0.4% to $1,995 an ounce.

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