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By Gina Lee
Investing.com – Asia-Pacific stocks were down Friday morning, ending the week in the red as investors remain concerned about the US Federal Reserve’s dovish stance on inflation.
China’s Shanghai Composite lost 0.97% at 11:01 pm ET (3:01 am GMT) and the Shenzhen component slipped 1.70%.
Hong Kong’s Hang Seng Index fell 1.69%.
Japan’s Nikkei 225 fell 0.99% and South Korea’s KOSPI fell 1.03%. In Australia, the ASX 200 fell 0.47%.
The Fed’s stance, which made its policy decision on Wednesday, stabilized yields on U.S. Treasuries after the ten-year benchmark climbed to 1.75% for the first time since January 2020. That helped also stimulated bets on faster inflation and sent market price expectations. pressures to heights not seen for several years.
The Bank of Japan made its policy decision earlier today amid speculation the central bank may adjust the target range for bond yields and asset purchases. The Bank of England also kept its March interest rate unchanged at 0.10% on Thursday.
“The economic recovery is underway and we have central banks around the world very much committed to easy monetary policy,” Tribeca Investment Partners portfolio manager Jun Bei Liu told Bloomberg.
Liu also sees value stocks benefiting from the rally, adding, “All of this together will indicate that this is just short-term profit-taking and the underlying fundamentals of the stock market look very strong.”
Investors have also braced themselves for a quadruple witchcraft, with derivatives of stock index futures, stock index options, stock options, and single stock futures expiring simultaneously and potentially exacerbating price fluctuations. asset prices, Friday.
Thursday’s high-level talks between the United States and China were also broadcast on investor radars, the first to take place since President Joe Biden took office in January. The talks, which took place in Anchorage, have turned into feuds and recriminations over human rights, trade and international alliances, illustrating that tensions continue to persist in US-China relations even after the change. of American leadership.
Meanwhile, Europe’s COVID-19 vaccination program continues to struggle to gain traction. Adding to doubts about the speed of Europe’s economic recovery after COVID-19, some countries in the region are facing a third wave of COVID-19 cases. One of them is France, which has announced a new lockdown in Paris and other parts of the country.
However, the European Medicines Agency’s (EMA) approval of the AstraZeneca PLC (LON: AZN) / University of Oxford COVID-19 vaccine on Thursday could get the program back on track. Some of the countries that have suspended use of the vaccine due to concerns about potential side effects, including Germany and France, were planning to resume use of the vaccine after EMA approval.
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