Asian Shares Choppy
28 January 2016 - 2:30PM
Dow Jones News
Trading in Asian shares was choppy Thursday, as investors
weighed the U.S. Federal Reserve's latest statement that it is
monitoring global economic and financial developments ahead of its
March decision on interest rates.
Hong Kong's Hang Seng Index was near flat, while Australia's
S&P/ASX 200 turned positive, last up 0.6%.
The Nikkei Stock Average and South Korea's Kospi pared losses to
trade essentially flat.
Meanwhile, the Shanghai Composite Index was recently down 0.5%
at 2723.64, near its lowest levels since December 2014, as
investors worry about China's slowing economy and increasing
capital outflows.
The possibility of the Fed increasing interest rates in March
was unnerving investors throughout Asia. A longstanding policy of
low interest rates has driven a rally in stocks world-wide since
the financial crisis.
The S&P 500 fell 1.1% on Wednesday after the central bank
stopped short of saying that recent economic and financial
developments could restrain economic activity and push down
inflation. A 13% loss in U.S. oil prices this year has raised
questions about the outlook for already low inflation and added a
sense of general uncertainty in markets.
Still, federal-fund futures, used by investors and traders to
place bets on central-bank policy, showed Wednesday that they
expect a 29% likelihood of a rate increase from the Fed at its
March meeting, according to data from CME Group. The probability
was 34% before the Fed's Wednesday statement
China shares were lower for the third straight session, even as
authorities appear to be ramping up efforts to halt money outflows,
Yesterday, the Shanghai Composite Index recovered steep losses late
in the session to finish down slightly. Some analysts attributed
the late-day surge to buying by large Chinese institutions like
mutual funds, or to coordinated buying by state-owned funds tasked
to support shares.
On Thursday, Japanese shares were also down as the Japanese yen
strengthened, which hurts the competitiveness of the country's
exporters.
The yen was up 0.1% at ¥ 118.75 to the U.S. dollar, compared
with the previous day.
Brent crude oil was down 0.8% at $33.66.
Saumya Vaishampayan contributed to this article.
Write to Chao Deng at Chao.Deng@wsj.com
(END) Dow Jones Newswires
January 27, 2016 22:15 ET (03:15 GMT)
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