Asia stock slide deepens; tech shares weak
Singapore: Asian stocks fell on Monday after Wall Street suffered its worst three-day slide in 10 months, but losses were muted, and high-yielding currencies edged up as some investor appetite for riskier assets surfaced.
Disappointing results announced by Google Inc on Friday dragged down tech-related shares in Tokyo, pushing the Nikkei index down 1.2 percent, but analysts shrugged off the fall.
They said that while Tokyo had been hit by an inevitable negative reaction given the sharp U.S. losses, there were some signs that its declines might be relatively small.
"Stocks that you might have expected to have really lost a lot, such as the megabanks, aren`t down so much, and that`s true of a lot of the big-cap shares as well," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.
"There`s the chance that foreigners may be buying, that there could be a bit of a pull-back from the United States and Europe that`s coming into Japan."
Wall Street stocks fell as much as 2.7 percent on Friday on worries over President Barack Obama`s plan to curb bank risk-taking, which could hit their profits, and on Google`s result.
With the sudden loss of leadership from the financial and tech sectors, which have led a global rally in recent months, analysts are unsure if equities will continue to sink. Some investors fear the global economic recovery may be slowing, and a number of technical indicators point to further weakness.
The main US stock indices have lost all the gains made this year and fell below key support levels and their 50-day moving averages, a move seen as a bearish signal.
The MSCI index for Asia ex-Japan shares was down 0.72 percent on Monday.
On foreign exchange markets, high-yielding currencies like the Aussie and the kiwi rose on Monday, inching up to $0.9070 and $0.7160 respectively, from $0.9003 and $0.7110 late on Friday.
Analysts said risk appetitehad been lifted by reports that Federal Reserve Chairman Ben Bernanke was moving closer towards confirmation for a second term.
Investors were spooked last week after several key senators announced their opposition to Bernanke`s reappointment but the top Senate Republican predicted confirmation.
The U. dollar edged up against the yen to 90.20 yen , from 89.87 yen late on Friday in New York but fell about 0.1 percent against a basket of six currencies.
The greenback had struck a five-week high against the dollar and a nine-month high on the euro on Friday as investors rushed towards safe-haven assets.
Still, demand for riskier assets and higher-yielding currencies is likely to remain subdued amid rising concerns over Greece`s fiscal problems; worries that China`s efforts to curb its surging economy may impair global growth and fears that the populist turn at the White House might impact U.S. bank earnings.
Traders are awaiting the response to Greece`s proposed issue of a 5-year benchmark bond issue later on Monday as a test of investor appetite, analysts said.
On other markets, crude oil steadied near its four-week low of below $75 a barrel, while spot gold trekked upward to $1,098.65 per ounce from the New York close of $1,091.65 as the dollar edged down.
More from India
More from World
More from Sports
More from Entertaiment
- Shocking: New ISIS video shows English-speaking boy beheading man
- Watch: Hafiz Saeed warns India of more terror attacks
- DNA: Army declares all soldiers in Siachen avalanche dead
- DNA: Indian Navy set to conduct International Fleet Review 2016
- Modi should not think of sending forces to fight ISIS: AIMIM chief Owaisi
- `Jawaharlal Nehru awarded the man who stole Subhas Chandra Bose's INA treasure`
- Ten Army soldiers missing in Siachen avalanche presumed dead; PM Modi 'salutes' martyrs
- ‘Ghayal Once Again’ tweet review
- Deepika Padukone's first shot from 'XXX 3' revealed! See pic
- Hashim Amla refuses to be interviewed by 'underdressed' Indian TV anchor: Report