BEIJING: Asian stock markets held steady after three sessions of losses on Wednesday as investors waited for any signs of a sharp tightening of monetary policy. US Federal Reserve Later in the day.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.1% on Wednesday, following sharp losses earlier this week, which have left the index up 2.8% this year. It is testing a one-year low in mid-December.
Japan’s Nikkei took some early losses to trade 0.37% lower, hovering around its lowest level since December 2020.
The cautious rebound for stocks looked set to continue in Europe, with pan-area Euro Stoxx 50 futures up 0.5%, and FTSE futures up 0.8%.
Nasdaq futures rose 0.3% in Asian trading, while the S&P 500 E-Minis were flat, following losses in all three major US indices on Tuesday.
irrigated It is due to update its policy plan later on Wednesday after a two-day meeting, and prices the markets for its first rate hike in March, with three more quarter-point increases by the end of the year.
“Asian markets are currently being impacted by volatility in global markets, concerns about Fed tightening due to high inflation and uncertainty about events in Russia and Ukraine,” said Mansoor Mohi-Uddin, chief economist at the Bank of Singapore.
“We expect the Fed meeting, however, not to increase volatility. The central bank is only set to end its quantitative easing in March and will signal that interest rates are likely to rise in March as well, the Fed This will support market expectations for a quarterly 25 bps hike for its fed funds rate instead of more aggressive tightening this year, Mohi-Uddin said.
Rising tensions over Russian troops gathering along the Ukrainian border have added to the risky environment for investors.
Globally, US stocks last week posted their worst week since 2020, and MSCI’s world index is in for its biggest monthly fall since the Covid-19 pandemic hit markets in March 2020.
However, analysts believed this was unlikely to derail the Fed’s plans to tighten policy.
“As long as the turbulence in equity markets remains relatively undisturbed, the Fed is more likely to be vulnerable,” analysts at Nomura said in a note.
He said he thought some of the Fed’s policy committee would interpret the latest sell-off in equities as potentially some “foaming” in the market, so it would not change his outlook, especially given concerns about higher inflation. between.
On Wednesday, China’s blue-chip index fell 0.33% to its lowest level since October 2020, while Hong Kong’s Hang Seng index was down 0.3%.
Hao Hong, Head of Research at BOCOM International, expects investors to have limited willingness to hold large positions in Asia after a heavy sell-off in the market as the Lunar New Year holiday approaches.
US Treasuries were steady, with yields of 1.0313% on the two-year notes, on gains made earlier this month. The yield on the benchmark 10-year Treasury notes stood at 1.7743%, down slightly from last week’s two-year high of 1.9%.
The dollar index was mostly unchanged against a basket of major currencies, with the greenback hitting its month high the day before the euro.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.1% on Wednesday, following sharp losses earlier this week, which have left the index up 2.8% this year. It is testing a one-year low in mid-December.
Japan’s Nikkei took some early losses to trade 0.37% lower, hovering around its lowest level since December 2020.
The cautious rebound for stocks looked set to continue in Europe, with pan-area Euro Stoxx 50 futures up 0.5%, and FTSE futures up 0.8%.
Nasdaq futures rose 0.3% in Asian trading, while the S&P 500 E-Minis were flat, following losses in all three major US indices on Tuesday.
irrigated It is due to update its policy plan later on Wednesday after a two-day meeting, and prices the markets for its first rate hike in March, with three more quarter-point increases by the end of the year.
“Asian markets are currently being impacted by volatility in global markets, concerns about Fed tightening due to high inflation and uncertainty about events in Russia and Ukraine,” said Mansoor Mohi-Uddin, chief economist at the Bank of Singapore.
“We expect the Fed meeting, however, not to increase volatility. The central bank is only set to end its quantitative easing in March and will signal that interest rates are likely to rise in March as well, the Fed This will support market expectations for a quarterly 25 bps hike for its fed funds rate instead of more aggressive tightening this year, Mohi-Uddin said.
Rising tensions over Russian troops gathering along the Ukrainian border have added to the risky environment for investors.
Globally, US stocks last week posted their worst week since 2020, and MSCI’s world index is in for its biggest monthly fall since the Covid-19 pandemic hit markets in March 2020.
However, analysts believed this was unlikely to derail the Fed’s plans to tighten policy.
“As long as the turbulence in equity markets remains relatively undisturbed, the Fed is more likely to be vulnerable,” analysts at Nomura said in a note.
He said he thought some of the Fed’s policy committee would interpret the latest sell-off in equities as potentially some “foaming” in the market, so it would not change his outlook, especially given concerns about higher inflation. between.
On Wednesday, China’s blue-chip index fell 0.33% to its lowest level since October 2020, while Hong Kong’s Hang Seng index was down 0.3%.
Hao Hong, Head of Research at BOCOM International, expects investors to have limited willingness to hold large positions in Asia after a heavy sell-off in the market as the Lunar New Year holiday approaches.
US Treasuries were steady, with yields of 1.0313% on the two-year notes, on gains made earlier this month. The yield on the benchmark 10-year Treasury notes stood at 1.7743%, down slightly from last week’s two-year high of 1.9%.
The dollar index was mostly unchanged against a basket of major currencies, with the greenback hitting its month high the day before the euro.
,