Asia Stocks Drop as Yen Gains; Aussie Dollar Slips: Markets Wrap
Tokyo, Sydney stocks lower; China, India shut for holidays
Australia’s central bank leaves interest rates unchanged
Asian stocks slipped, taking their cue from a weaker U.S. equities session, as a rising yen weighed on shares in Tokyo. The Australian dollar dropped after the nation’s central bank left rates unchanged.
The yen climbed against the dollar for a third day. Tokyo shares were led lower as auto manufacturers reported worse-than-expected U.S. sales for March. China, Hong Kong, Taiwan and India are closed for a holiday. The Aussie fell for a fourth day while government bonds climbed. South Africa’s rand extended declines for a seventh day after the country lost its investment-grade credit rating from S&P Global Ratings for the first time in 17 years.
Investors are taking stock ahead of a key U.S. payrolls report on Friday and minutes from the Federal Reserve’s latest meeting on Wednesday. Institute for Supply Management data showed U.S. factories continued to expand production at a robust pace in March, reaffirming faith in the global economic recovery.
Australia kept interest rates unchanged, remaining in a form of policy paralysis as housing is too hot to allow an easing and the economy too weak to absorb a tightening. India’s central bank also will probably hold rates firm later this week.
What investors will be watching this week:
- Fed speakers include William Dudley, president of the New York Fed, and Governor Daniel Tarullo. Minutes from the March meeting, which are scheduled to be released April 5, should put their recent public comments into perspective. Minutes are also due from the European Central Bank’s latest gathering.
- China’s President Xi Jinping will meet U.S. President Donald Trump for two days starting April 6.
- U.S. non-farm payrolls are due April 7.
Here are the main moves in markets:
- The yen rose 0.4 percent to 110.44 per dollar as of 1:54 p.m. in Tokyo, after climbing 0.5 percent in each of the previous two sessions. The Aussie dollar fell 0.3 percent, bringing its four-day decline to more than 1 percent. The New Zealand dollar fell 0.3 percent.
- The Bloomberg Dollar Spot Index was little changed.
- The Russian ruble steadied after declines sparked by a subway bomb in St. Petersburg that killed 11 people.
- The South African rand dropped 0.8 percent. The currency has tumbled 11 percent over the past seven days amid a cabinet purge by President Jacob Zuma that’s sparked increasing calls for him to resign.
- The Topix index lost 1 percent, with Honda Motor Co., Mazda Motor Corp. and Nissan Motor Co. dropping more than 3 percent. Australia’s S&P/ASX 200 Index sank 0.3 percent and South Korea’s Kospi slid 0.2 percent.
- The Philippines benchmark index jumped 1.3 percent to the highest level since October.
- Futures on the S&P 500 lost 0.2 percent. The underlying gauge slid 0.2 percent on Monday and the Stoxx Europe 600 Index declined 0.5 percent.
- The yield on 10-year Treasuries rose less than one basis point to 2.33 percent, after declining seven basis points on Monday.
- Australia’s 10-year yield fell nine basis points to 2.59 percent.
- Oil was flat at $50.23 per barrel, after dropping 0.7 percent on Monday.
- Gold rose 0.2 percent to $1,256.40, advancing for a third day.