Metals Drag Asian Stocks Lower, With South Korea Bucking Trendby
Kospi closes at record, commodities weigh on most of region
U.S. Federal Reserve left rates unchanged as expected
Metals weighed on Asian stocks Thursday even after the U.S. Federal Reserve seemed unfazed about slower first-quarter growth in the world’s largest economy.
The MSCI Asia Pacific excluding Japan Index fell 0.3 percent to 487.44 as of 4:41 p.m. in Hong Kong, with the materials group leading losses. Equity markets in South Korea and Hong Kong reopened after Wednesday’s holiday while Japan remains closed for the rest of the week.
Iron ore fell 5.3 percent in Dalian, making Australia’s Fortescue Metals Group Inc. one of the worst performers on the country’s benchmark index, weighed by signs of ample copper supplies and investor concern about the outlook for demand in China.
The Shanghai Composite Index closed at its lowest level since January and the S&P/ASX 200 gauge fell 0.3 percent. Overnight in Washington, the Federal Reserve stuck to its outlook for gradual monetary-policy tightening and left rates unchanged, showing no alarm about recent economic weakness in the U.S.
“The market is a reflection of Australia more than anything else,” Chris Weston, a market strategist at IG Markets Ltd. in Melbourne, said by phone. “When you see copper in China down so heavily, iron ore absolutely smashed, steel futures getting hit pretty hard, there’s no surprise” that stocks are down, he said.
South Korea’s Kopsi bucked the trend, rising to a record. Equities in Asia’s fourth-largest economy, which are cheaper than other emerging markets on average, have been attracting overseas investors. The Philippines market also gained after President Rodrigo Duterte’s tax plan passed its first hurdle.
- Shanghai Composite -0.3%, Hang Seng -0.1%, Hang Seng China Enterprises Index -0.8%
- Kospi +1%; Taiwan’s Taiex +0.1%
- New Zealand’s NZX 50 -0.4%
- Singapore’s Straits Times Index -0.3%; Malaysia’s KLCI -0.9%; Jakarta Composite Index +0.1%; Philippine Stock Exchange Index +1%; Thailand’s SET Index +0.5%; India’s Sensex +0.8%
- Bloomberg Commodity Index fell 0.5%