Asian shares battle despite Fed cut
Asian shares struggled to find footing on Wednesday and bonds held stunning gains, as an emergency rate cut from the US Federal Reserve seemed to stoke rather than soothe fears over the coronavirus’ widening global economic fallout.
- MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4% amid choppy trade across the region, though most of the gains were confined to South Korea. Japan’s Nikkei oscillated between flat and modest gains.
- Australia’s S&P/ASX 200 index fell 1.5%, while stocks in Hong Kong and China traded flat.
- Korean stocks bucked broader weakness, rising 2% after the government announced a stimulus package of 11.7-trillion won to mitigate the impact of the virus outbreak.
- Futures for the S&P 500 were volatile as the results of Democratic Party primaries came in, eventually firming 1% as moderate Joe Biden looked set to win five big states compared with two for radical Bernie Sanders.
- In currencies, the US dollar fell across the board, sending it to an eight-week low against a basket of currencies, while pushing the euro to an eight-week peak.
- In Asian trade, the yen hit its highest against the greenback since October, at 106.84/$, before paring gains. The Australian dollar advanced to $0.6603.
Oil and Gold Prices
- Oil prices firmed on expectations of production cuts, with Brent rising 90c to $52.79 per barrel and US crude up 1.9% at $48.06 a barrel.
- Gold rose 0.2% to $1642.21/oz.