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  15 Sep 2021, 09:53

Asian markets slip again as US data fails to temper recovery worries

   HONG KONG, Sept 15, 2021 (BSS/AFP) - Asian markets sank again Wednesday,
tracking another sell-off on Wall Street, as figures indicating US consumer
inflation slowed last month were unable to overcome concerns about the impact
of the Delta variant on the global recovery outlook.

   After a bright start to the month, equities around the world have gone
into reverse in recent sessions as confidence is shaken by the virus with a
number of countries seeing a worrying jump in new cases that have forced
some, including China, to reimpose tough containment measures.

   Investors are also having to grapple with a range of other issues
including Federal Reserve plans to taper monetary policy, China's regulatory
crackdown on private enterprises and a possible default by Chinese property
giant Evergrande, which is teetering under debts of more than $300 billion.

   Data Tuesday showing US consumer prices rose last month at a slower pace
than expected soothed concerns that inflation could force the Fed to begin
winding down its market-supporting policies earlier than thought.

   The reading had taken on particular importance after producer prices --
what firms pay at the factory gate -- hit a record high in August owing to
rising demand and tighter supplies.

   The figures showed a slight dip, appearing to back up Fed officials'
insistence that the sharp rises were temporary because of the reopening and
short-term supply issues.

   But US investors shrugged at the news and sent all three main indexes into
the red.

   Analysts pointed out that the easing came on the back of concerns about
the spread of the Delta variant, which is sending infection rates surging.
That led to a sharp drop in airline fares, while used car sales -- a major
cause of recent inflation spikes -- also fell.

   However, National Australia Bank's Rodrigo Catril said: "There are still
many factors suggesting inflation is unlikely to ease significantly.
Inflation remains strong for food, housing and other goods.

   "The decline in airline fares and hotel room rates are likely to reverse
as the Delta wave fades."

   - Casinos plunge -

   While noting that the print would ease pressure on the Fed to tighten
policy, he added that "debate on higher US inflation has not gone away and
next year the big focus will be to what extent the expected rise in wages
will deliver longer-lasting upward pressure on prices".

   A taper in November or December still looked likely, he said.

   And Dana D'Auria, of Envestnet Inc, told Bloomberg Television: "It is hard
to argue at this point that (inflation) remains entirely transitory.

   "You couple that with the fact that there are still all these supply
shocks that we are still working through. I think the markets are going to
have to feel the pain."

   Asian markets were under pressure in the morning session.

   Hong Kong was among the losers, with Macau casino operators collapsing as
they became the latest to fall into China's regulatory crosshairs.

   On Wednesday, the Macau government unveiled plans to tighten control over
the industry, with recommendations including reviewing the number of
concessions it issues, putting representatives on the boards of operators and
criminalising underground banking in the industry.

   Sands Macau and Wynn Macau plunged about 25 percent, Galaxy Entertainment
was off 15 percent and MGM China dropped 20 percent.

   The news comes as the firms were already struggling owing to the impact of
the coronavirus on tourism to the city, which usually rakes in more money in
a single week than Las Vegas makes in a month.

   Tokyo, Shanghai, Singapore, Sydney, Wellington, Taipei and Jakarta all
fell, though Seoul and Manila managed gains.

   Meanwhile, observers said the selling in September was not much of a
surprise.

   "September is the only month in the calendar year with historically
negative returns if you look back 50 years or more," said markets strategist
Louis Navellier.

   "That's not a guarantee, as some Septembers have been great, but the long-
term trend suggests that we should be on the lookout for sell-offs in
Septembers."

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