BCN-39 Asian markets see modest gains as US takes a break

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ZCZC

BCN-39

ASIA-MARKETS-UPDATE

Asian markets see modest gains as US takes a break

HONG KONG, Nov 22, 2018 (BSS/AFP) – Asian equities chalked up modest gains
Thursday in light trading ahead of the US Thanksgiving holiday, following a
rebound in energy and tech stocks on Wall Street.

But analysts cautioned the tepid uplift in New York Wednesday should not
be interpreted as a sign of the start of a recovery from the recent carnage
on global stock markets.

Investor sentiment remains fragile following the volatility that has swept
markets since October, while the OECD has warned that the world economy has
peaked and faces a slowdown as it confronts the Trump administration’s trade
war and tighter monetary conditions.

The dollar slipped against the euro, the pound and the yen amid reports
the Federal Reserve may pause future interest-rate hikes.

Crude prices resumed their downward trajectory Thursday, after a brief
recovery on Wednesday.

The commodity has fallen by almost 30 percent from four-year highs touched
at the start of October. Oil analysts attribute the pullback to high supply
as well as a weakening global growth outlook.

“This half-hearted recovery effort should not be confused with anything
other than pre-holiday scramble doing little more than what amounted to
chasing oil prices,” said Stephen Innes, head of Asia-Pacific trade at OANDA.

“Markets have been remarkably muted, even by holiday standards.”

He added the post-Thanksgiving Black Friday shopping spree would be “the
ultimate litmus test of US consumer confidence heading into the holiday
season”.

Ahead of a Friday holiday in Japan, the Nikkei rose 0.65 percent as
investors took heart from the weakening yen.

However, fresh data suggested the world’s third-largest economy is
continuing to struggle in its years-long battle with deflation.

– Bitter row –

Inflation in Japan stood at one percent in October, unchanged from the
previous month, according to government data.

Japan has battled deflation for many years and the central bank’s ultra-
loose monetary policy appears to have had limited impact.

Late last month, the Bank of Japan again revised down inflation forecasts,
in the latest sign it had failed to make headway towards its two-percent
target despite years of massive monetary easing.

Shares in Nissan rose 0.77 percent ahead of its board meeting that will
propose the sacking of disgraced chairman Carlos Ghosn, after his spectacular
arrest for financial misconduct sent shockwaves through the car industry and
the business world.

The scandal has sparked questions over whether the alliance of Nissan,
Renault and Mitsubishi Motors can survive without Ghosn, seen as the glue
holding together his fractious creation, which globally employs around
450,000 people.

Elsewhere, Hong Kong ended the day with modest gains and Shanghai closed
slightly down, while Sydney was the standout regional performer, gaining 0.9
percent. Shares in Singapore were up even as the trade-reliant city-state
braces for slower economic growth next year as demand in key markets in Asia
weakens.

In early trade in Europe Thursday, London dropped 0.2 percent while both
Paris and Frankfurt slid 0.3 percent. Bourses had staged a sharp recovery
Wednesday even as the EU, as expected, officially rejected Italy’s big-
spending budget, clearing the path for unprecedented sanctions and deepening
a bitter row with Rome’s populist government.

However, reports said Italy’s government may be open to budget revisions
as the European Union took a first step toward imposing fines on the country.

– Key figures around 0820 GMT –

Tokyo – Nikkei 225: UP 0.7 percent at 21,646.55 (close)

Hong Kong – Hang Seng: UP 0.2 percent 26,019.41 (close)

Shanghai – Composite: DOWN 0.2 percent at 2,645.43 (close)

Euro/dollar: UP at $1.1405 from $1.1385 at 2200 GMT

Pound/dollar: UP at $1.2788 from $1.2777

Dollar/yen: DOWN at 112.97 yen from 113.04 yen

Oil – West Texas Intermediate: DOWN 42 cents at $54.21 per barrel

Oil – Brent Crude: DOWN 55 cents at $62.93 per barrel

New York – Dow: FLAT at 24,464.69 (close)

London – FTSE 100: DOWN 0.2 percent at 7,031.49

BSS/AFP/HR/1440