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Monday Oct 07, 2024
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MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.1% in a choppy session.
China’s CSI300 Index advanced 0.8% and Seoul shares rose 0.9%, while Tokyo’s Nikkei benchmark, helped by the softer yen, climbed 2.2% to a three-week high.
“The recent decline opened up room for bargain-hunting, but thin trading volume underscores investors’ search for clues on the timeline for the Fed’s stimulus cutback,” said Lim Dong-rak, an analyst at Hanyang Securities in Seoul.
Financial bookmakers expected major European indexes to open steady to slightly higher, with both Britain and German inflation in focus.
Overnight, US stocks edged up, lifting the Dow Jones industrial average to another record closing high in light Veterans Day volume.
All eyes on China
All eyes will be on the unveiling of China’s economic blueprint for the next decade after a four-day closed-door meeting ends on Tuesday.
Beijing seeks to balance the need to overhaul the world’s second-largest economy while it tries to preserve stability and to reinforce the Communist Party’s power.
“In terms of the effect on the market, some people actually believe it might be slightly negative and the reason for that is ... you have a situation where the current investment in Chinese infrastructure slows down as these laws are changed,” said Evan Lucas, market strategist at IG in Melbourne.
But on a medium-term view, changes to the Chinese economy would boost growth in the region, he said.
Dollar in buoyant mood
The dollar was up 0.4% at 99.55 yen, edging close to the 100-mark, a level not seen since September 11.
The greenback rose 0.3% to $ 0.9331 to the Australian dollar, hitting a six-week peak after a measure of Australian business confidence pulled back from 3-1/2 year highs in October as sales and profits stayed subdued.
The euro dipped 0.1% to $ 1.3388 after bouncing 0.3% on Monday, ending two days of losses that saw the common currency briefly touch an eight-week low last Thursday when the European Central Bank unexpectedly cut interest rates.
The outlook for the dollar was upbeat with expectations building that the Fed might soon taper its $ 85 billion-a-month bond-buying program after US employers added more than 200,000 new jobs last month – many more than forecast by analysts.
Emerging currencies on the defensive
Emerging currencies remained on the defensive, reflecting concerns about capital outflow when the Fed scraps its cheap money policy.
The rupiah was down 0.6% to a six-week low at 11,625 per dollar, adding to Monday’s 1.3% slide, while the Philippine peso eased 0.3% to 43.70 to a dollar, a near two-month low.
Indonesia’s Central Bank is likely to keep its benchmark reference rate on hold at its monthly meeting on Tuesday, with inflation stabilised and the current-account deficit expected to narrow – relieving pressure on the ailing rupiah.
The Indian rupee fell 0.5% to 63.573 per dollar, its weakest since September 17, as investors awaited inflation and industrial output data.
Indian inflation is forecast to have risen to uncomfortable levels for policymakers last month, adding to the pressure for further interest rate increases.
Commodities markets
In the commodities markets, US crude prices slipped 0.3% to below $ 95.0 a barrel, giving up some of the 0.6% rise on Monday after Iran and six world powers failed to reach a deal on Tehran’s nuclear program and after Chinese data pointed to a rise in fuel demand.
Gold dipped 0.2% to below $ 1,280 an ounce, hovering near a three-week low touched overnight.
