Asian Stocks Fall as Focus Shifts to Trump, Yellen After Draghi

Updated on
  • Region’s benchmark declines for first time in 10 sessions
  • Federal Reserve’s rate decision on July 26 next on watch

Asian equities fell for the first time in 10 days, as investors chose to take some profit off the table amid an investigation into the U.S. president that may stall his economic agenda. 

The Federal Reserve’s meeting on July 26 also kept some investors on the sidelines ahead of the weekend after the European Central Bank deferred the decision on policy normalization until later this year.

The MSCI Asia Pacific Index fell 0.2% to 159.13 as of 4:35 p.m. in Hong Kong, snapping its longest winning streak since April 2015. The U.S. special counsel investigating possible ties between the Donald Trump campaign and Russia in last year’s U.S. presidential election is said to be examining a broad range of transactions involving Trump’s businesses as well as those of his associates.

Asia’s equity benchmark rose 4.4 percent in the nine sessions through Thursday, with markets in Japan and Hong Kong near two-year highs.

See also: Asia Stocks Week Ahead: FOMC, IMF Outlook, S. Korea GDP, Nissan

It is a “bit of profit taking” amid weak cues from global markets before the Fed’s rate decision next week, said Shane Oliver, Sydney-based global strategist at AMP Capital Investors Ltd., which manages about $120 billion. 

"The U.S. is overvalued, while rest of the world isn’t, so Asian stocks have more to gain especially as the Chinese economy is looking stronger and monetary policies in the region are relatively supportive," Oliver said.

Summary

  • Topix index -0.2%, Nikkei 225 Index -0.2%
  • Hang Seng Index -0.1%, Hang Seng China Enterprises Index -0.6%, Shanghai Composite Index -0.2%, Taiex -0.6%
  • Australia’s S&P/ASX 200 Index -0.7%, New Zealand’s NZX 50 little changed
  • Kospi index +0.3%, Kospi 200 Index +0.4%
    • South Korean Banks Gain as 2Q Earnings Beat Estimates
    • Seegene Drops Most in 7 Years as Danaher Cancels Contract
    • Goldman Upgrades SK Telecom to Buy on Improving Market Share
  • Straits Times Index +0.7%, FTSE Bursa Malaysia KLCI Index +0.2%, Philippine Stock Exchange PSEi Index +1.1%, region’s best performer Jakarta Composite Index -1%
  • Sensex Index +0.3%, Nifty Index +0.2%
    • Wipro Buyback, Reliance Profit Propel India’s Sensex Higher
    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE