Asian stocks plummet after Wall Street's defeat; Shanghai at four-year lows

Asian stocks plummet after Wall Street's defeat; Shanghai at four-year lows https://www.eresviral.com/wp-content/uploads/2018/10/Las-acciones-de-Asia-se-desploman-luego-de-la-derrota-de-Wall-Street-Shangai-en-mínimos-de-cuatro-años

Asian stocks plummet after Wall Street's defeat; Shanghai at four-year lows







SYDNEY / SHANGHAI (Reuters) - Asian equity markets sank in a sea of ​​red on Thursday after Wall Street suffered its worst blow in eight months, a conflagration of wealth that could threaten business confidence and investment in all the world. 











A man is seen behind an electronic board showing the Nikkei average and the Japanese yen rate against the US dollar on the Tokyo Stock Exchange in Tokyo, Japan, October 11, 2018. REUTERS / Issei Kato





"Equity markets are subject to a sell-off, with concerns about how much yields will rise, IMF warnings about financial stability risks and the continuing trade tension that drives uncertainty," ANZ analysts said.   

The global fall erased hundreds of billions of dollars of wealth. The head of the International Monetary Fund said that valuations of the stock market have been "extremely high". 

The broader MSCI index of Asia Pacific shares outside Japan fell 3.9% to its lowest level since March 2017. 

Japan's Nikkei fell 4.4 percent, the biggest daily decline since March, while the broader TOPIX lost about $ 230 billion in market value. 

Shares of Shanghai fell 4.3 percent, on its way to its worst day since February 2016, to its lowest level since the end of 2014, while China's blue chips fell 4 percent. 

Shares in Taiwan were among the most affected in the region, with the largest index losing 6.2 percent.  

"We can not see where the lowest point will be," said Chien Bor-yi, an analyst at Cathay Futures Consultant, based in Taipei. 

On Wall Street, the sharpest one-day fall of S & P500 since February erased around $ 850 billion as technology shares plummeted amid fears of a slowdown in demand. 









Visitors look at a stock exchange listing board on the Tokyo Stock Exchange in Tokyo, Japan, on October 11, 2018. REUTERS / Issei Kato



The S & P 500 ended Wednesday with a loss of 3.29 percent and the Nasdaq Composite with 4.08 percent, while the Dow lost 2.2 percent. 

Leaving blood was bad enough to attract the attention of US President Donald Trump, who pointed an accusing finger at the Federal Reserve for raising interest rates. 

"I really do not agree with what the Federal Reserve is doing," Trump told reporters before a political rally in Pennsylvania. "I think the Fed has gone crazy." 

Comments from Fed politicians triggered the sudden liquidation of Treasuries last week and sent long-term yields to their highest level in seven years. 

The increase made stocks less attractive compared to bonds, while also threatening to curb economic activity and profits. 

YUAN A POINT OF INFLAMMATION 

The change in yields is also sucking funds from emerging markets, exerting special pressure on the Chinese yuan, as Beijing struggles in a prolonged commercial battle with the United States. 

On Thursday, the World Bank president said he is very concerned about trade tensions and warned of a "clear" global economic slowdown if tariff threats increase. 

China has suspended approvals for an investment product abroad in Shanghai and has asked license holders such as JPMorgan Asset Management and Aberdeen Standard Investments to be "low profile" in its commercialization, as concerns increase in Beijing possible exit pressures. 

China's central bank has been allowing the yuan to decline gradually, breaking the psychological barrier of 6.9000 and leading speculators for the dollar to rise to 6.9388 at 0342 GMT. 









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The yuan on land traded at 6.9309 per dollar at 0350 GMT, 69 pips weaker than the close on land of 6.9240 on Wednesday. 

China's movement has forced other currencies in emerging markets to weaken to remain competitive, and has provoked the wrath of the United States, which sees it as an unfair devaluation. 

"The yuan has already weakened significantly, to offset the rates announced so far," said Alan Ruskin, global head of FX strategy for Deutsche G10. "A greater weakness could exacerbate the concerns of a self-fulfilling capital flight and a loss of control." 

There was also a danger to the United States if Beijing had to intervene energetically to support the yuan. 

"China that buys yuan and sells dollars is likely to involve some sale of US Treasury bonds at a point where the market shows some vulnerability, and could be very vulnerable to the signs of China's liquidation," Ruskin added. 

The dollar was already losing ground against the yen and the euro, as investors favored the currencies of countries with large current account surpluses. 

The euro rose to $ 1.1565 and moved away from a low of $ 1.1429 earlier this week. The dollar fell to 112.17 yen, down 0.1 percent and a revealing retreat from last week's high of 114.54. 

That left the dollar at 95.207 against a basket of currencies. [USD/]  

In commodity markets, gold struggled to obtain a security offer and was reduced to $ 1,193.40. 

Oil prices slipped in line with the US equity markets. UU., Although the energy traders were worried about reducing the Iranian supply of US sanctions. UU And they watched for the hurricane Michael, which closed part of the oil production in the Gulf of Mexico in the United States. UU [O/N] 

Brent crude fell 1.9 percent to $ 81.51 a barrel, while US crude fell 1.7 percent to $ 71.93.     

On Thursday, IMF director Christine Lagarde warned that the global economy "is probably not strong enough" and that, due to global public debt, a record high, emerging markets were at risk of capital outflows. 





Additional report of Jenny Kao in TAIPEI; Edition by Shri Navaratnam and Richard Borsuk





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