Charts Show the Damage a Day Can Do in Buoyant Asian Equities

  • Gauge of finance stocks slumped the most since U.S. election
  • Benchmark stocks gauge poised to halt eight-day rally

The year’s first storm dropped a lot of rain on Asian equities.

Selling spread across Asia as investors retreated from risk broadly, with the benchmark gauge headed for its first loss after an eight-day streak of gains. The MSCI Asia Pacific Index fell 1.5 percent at 1:30 p.m. in Hong Kong, falling from a 21-month high. Vietnam’s Ho Chi Minh Stock Index was the lone exception, rising 0.4 percent.

For now, a selloff is nothing to panic about in markets as buoyant as Asia’s, analysts said. The benchmark gauge was up more than 4 percent in a little under two weeks.

“Markets do need a good reason to take profit, and here it is,” Margaret Yang, an analyst at CMC Markets in Singapore, wrote in an email.

A gauge of finance companies led declines among 11 industry groups and dropped the most since the U.S. presidential election in November. Mitsubishi UFJ Financial Group fell 4.4 percent.

“We’ll need something more promising for the markets to regain confidence to mitigate the anxiety over the feasibility of” U.S. President Donald Trump’s policies, said Hideyuki Suzuki, a general manager at SBI Securities Co. in Tokyo.

Investors are recalibrating expectations to reflect the unlikelihood of Trump pushing through his growth agenda overnight, Jonathan Ravelas, chief market strategist at BDO Unibank, said by phone. Asian equity markets have rallied recently which allows for a technical correction, said Ravelas.

Vietnam is bucking the trend “mainly thanks to the advance in some blue chips such as Vinamilk and Vingroup,” said Phan Viet Hung, Ho Chi Minh City-based analyst at ACB Securities JSC over Skype. News that a derivatives market is planned in the Southeast Asian nation may be supporting the advance today, he said.

— With assistance by Giang Nguyen

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE