Asia mostly down after rally, greenback weakens

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With few events to drive buying, investors took a step back following a recent rally across global trading floors while there is a nagging fear that President Donald Trump’s promised tax cuts and spending splurge could come later than hoped.

“Positive catalysts to further moves higher appear to be lacking at the moment,” said Greg McKenna, chief market strategist at AxiTrader, in a note.

“The delay on the details of (Trump’s) tax plan is a risk for stocks if U.S. data starts to disappoint.”

Wall Street provided a damp lead with the Dow and S&P 500 ending lower Friday.

In Asian trade Hong Kong rose 0.8 percent to levels not seen since August 2015 and Shanghai edged up 0.4 percent but Sydney shed 0.4 percent, Seoul also gave back 0.4 percent and Singapore was 0.5 percent lower.

Wellington tumbled 1.4 percent, hit by a 10 percent dive in market giant Fletcher Building, which cut its profit forecast citing huge losses on a key construction project.

Japanese markets were closed for a public holiday.

Trade Fears

In foreign exchanges the dollar was down against most other currencies after the Fed on Wednesday lifted borrowing costs as expected but pointed to another two rises this year, confounding talk of a possible three or four.

The greenback retreated against the yen and euro as well as most other high-yielding currencies including the Australian dollar, South Korean won, Thai baht and Indonesia’s rupiah.

“The less hawkish stance by the Fed has opened the door for local (emerging market) trade, even more so with the stronger-than-expected Chinese data last week, adding to the global dollar squeeze,” said OANDA senior trader Stephen Innes.

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