Asian markets rally stumbles after recent surges
AFP – The rally that has seen in 2018 stuttered Friday as most Asian markets struggled with profit-taking, with investors unable to track more records on Wall Street.
Dealers are now turning their attention to the release later in the day of key US jobs data, which is expected to show the world’s top economy continuing to improve.
A forecast-smashing reading Thursday on private take-ups boosted optimism, which had already been bolstered by US tax cuts, healthy corporate profits and strong manufacturing figures from around the world.
Global markets powered ahead in 2017 as economies showed long-running improvements after years of faltering while a surge in oil prices to around three-year highs has provided a bright start to January.
And Greg McKenna, chief market strategist at AxiTrader, said in a note that data from the manufacturing and services sectors "suggests economic strength across the globe remains robust". He noted that an index of world factory activity was at its highest level in seven years.
On Wall Street the Dow ended above 25,000 for the first time, leading records across Wall Street.
However, Asia was mixed Friday.
In Tokyo the Nikkei ended the morning up 0.2 percent at a 26-year high following its more than three percent jump Thursday, while Sydney added 0.6 percent.
Seoul rose 0.7 percent, with dealers buoyed by news that North Korea had accepted the South’s offer of talks next week, further easing geopolitical tensions in the region.
But Hong Kong and Shanghai each lost 0.1 percent and Singapore eased 0.3 percent.
On forex markets the dollar dipped slightly against the euro, with the eurozone continuing to improve and raising the chances of a reduction in the region’s massive stimulus programme, bringing monetary policy in line with the Federal Reserve.
McKenna added: "It’s again the story of a weaker US dollar as the fact its data is solid and improving is lost on traders focused on expectations that the EU strength will drive the European Central Bank to chase the Fed, and that synchronised global growth will, in fact, drag most central banks along the tightening path."
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 0.2 percent at 23,547.78 (break)
Hong Kong – Hang Seng: DOWN 0.1 percent at 30,699.26
Shanghai – Composite: DOWN 0.1 percent at 3,381.50
Euro/dollar: UP at $1.2080 from $1.2070 at 2140 GMT
Pound/dollar: UP at $1.3562 from $1.3553
Dollar/yen: UP at 112.75 yen from 112.72 yen
Oil – West Texas Intermediate: DOWN two cents at $61.99 per barrel
Oil – Brent North Sea: UP two cents at $68.09 per barrel
New York – DOW: UP 0.6 percent at 25,075.13 (close)
London – FTSE 100: UP 0.3 percent at 7,695.88 (close)