Talking Points:
- Asian stocks had a mixed session on Thursday
- Toshiba continued to weigh on the Nikkei’s fortunes, but Chinese stocks gained
- The Dollar slipped a little from one-month highs despite elevated rate-rise expectations
Thursday was a mixed session for Asian markets, with Wall Street’s enduring pep unable to prevent a slip for the Nikkei.
The Japanese benchmark was again hit by the woes of heavyweight Toshiba. It fell more than 8% on Wednesday and slipped by about half that amount on Thursday. This was thanks to reports that it may delay the sale of its flash-memory chip unit, chasing revenue following a huge hit at its US nuclear operations.
South Korea’s Kospi couldn’t hold early gains, although stocks in both Hong Kong and mainland China managed to stay up. Australia’s ASX ended a little higher. Regional data was sparse but what there was attracted interest.
Australia’s official employment stats for January beat forecasts again, but investors asked questions over the rise in part-time employment at the expense of full-time positions. Levels of foreign direct investment slid sharply in China. The statistics agency was quick to blame this on “one offs,” such as a high base of comparison and the timing of China’s New Year break. However, Beijing has been making strenuous efforts to try and attract investment this year.
Elsewhere Federal Reserve Chair Janet Yellen left the door to higher interest rates very much open in this week’s two-day testimony to Congress. Speaking on Wednesday her colleague William Dudley of the New York Fed indicated that a rise could come soon. None of this did the US Dollar much good in what was a pretty torpid Asia/Pacific foreign exchange session. It slipped a little against the Yen and the Australian Dollar, albeit from around one-month highs.
Gold prices ticked up despite the scent of higher US rates in market nostrils, probably gaining as the greenback slipped a little. Crude oil prices were steady, seemingly caught between ongoing confidence in production cuts from major producers and rising US inventory and supply.
The rest of the session will offer investors the official account of the last European Central Bank policy meeting. After that it’s all about the US, with housing starts, weekly jobless claims and the Philadelphia Fed’s business outlook all on the schedule.
Halfway through the first quarter, how are the DailyDX analysts’ forecasts holding up?
--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter: @DavidCottleFX
