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ASIA-MARKETS-UPDATE
Asian markets tumble after disappointing US earnings
HONG KONG, July 26, 2019 (BSS/AFP) – Asian markets tumbled Friday after
disappointing US earnings and a bearish outlook on hopes for a Fed rate cut
weighed on Wall Street overnight.
Tesla and American Airlines both suffered bruising declines after posting
quarterly results, while Amazon reported a slowdown in earnings growth as it
ramped up one-day delivery operations.
American stocks had been bolstered in recent weeks by expectations that
the Federal Reserve will cut interest rates next week.
But strong American economic data, including Thursday’s report showing an
increase in durable goods sales in June, has investors fearing a less dovish
Fed announcement.
“Markets are getting nervous that Fed could disappoint next week,” said
OANDA senior market analyst Edward Moya.
Recent data also showed that Washington’s long-running trade war with
Beijing was “not having a terrible impact” on the American economy, he added,
tempering hopes of a sizeable rate cut.
Tokyo was down 0.5 percent at close as investors went into profit-taking
mode ahead of the weekend, ending a three-day winning streak.
Beleaguered automaker Nissan was off 3.2 percent after announcing a 95-
percent plunge in quarterly net profit and the shedding of 12,500 jobs on
Thursday.
Chip-testing equipment maker Advantest also edged lower after a 20.2
percent surge Thursday on better-than-expected quarterly earnings.
But Japan’s SoftBank Group rose 1.1 percent after it announced a new $108-
billion fund to drive investment in artificial intelligence.
– Euro in flux –
Shanghai closed up 0.2 percent but Hong Kong fell by 0.7 percent, erasing
the week’s gains, while Singapore and Taipei were both down.
Sydney pared Thursday’s gains on the back of central bank chief Philip
Lowe hinting at further rate cuts, finishing 0.4 percent down after
Australia’s competition watchdog called for measures to better police
internet giants Google and Facebook.
MORE/HR/1448
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ASIA-MARKETS-UPDATE 2 LAST HONG KONG
Mixed messaging from the European Central Bank over further stimulus had
weighed on regional bourses, said Michael Hewson of CMC Markets, after major
European indices dipped in Thursday trade.
“Uncertainty has elicited a similar response from markets in Asia where
the Bank of Japan also has a similar decision to make next week about easing
policy further,” he said.
The euro hit two-year lows before rallying Thursday after the ECB
signalled it could soon undertake new stimulus measures and cut rates to
boost flagging growth and inflation in Europe.
But “the lack of detail alongside a lack of urgency, notwithstanding an
explicit acknowledgement of things getting worse, looks to have disappointed
the market,” said National Australia Bank’s Rodrigo Catril.
London and Frankfurt were both up 0.1 percent shortly after Friday’s open.
– Key figures around 0720 GMT –
Tokyo – Nikkei 225: DOWN 0.5 percent at 21,647.29 (close)
Hong Kong – Hang Seng: DOWN 0.7 percent at 28,397.74 (close)
Shanghai – Composite: UP 0.2 percent at 2,944.54 (close)
London – FTSE 100: UP 0.1 percent at 7,493.32
Pound/dollar: DOWN at $1.2428 from $1.2447
Euro/pound: UP at 89.59 pence from 89.56 pence
Euro/dollar: DOWN at $1.1136 from $1.1145
Dollar/yen: DOWN at 108.63 yen from 108.66 yen
West Texas Intermediate: UP 35 cents at $56.37 per barrel
Brent North Sea crude: UP 21 cents at $63.60 per barrel
New York – Dow: DOWN 0.5 percent at 27,140.98 (close)
BSS/AFP/HR/1450