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Home / Business / Asian stocks slide as suspicions of American stimulus grow

Asian stocks slide as suspicions of American stimulus grow



TOKYO / BOSTON (Reuters) – Asian stocks fell on Wednesday amid growing uncertainty over whether US lawmakers would reach an agreement on an additional round of major fiscal stimulus to support an economy still battling the coronavirus pandemic.

PHOTO PHOTO: A man wearing a face mask was spotted inside the Shanghai Stock Exchange building after the country was hit by a new coronavirus outbreak, in Pudong Financial District in Shanghai, China February 28, 2020. REUTERS / Aly Song

However, vaccine development hopes prompted some investors to reduce safe-haven assets such as gold and government bonds and buy the corrupted stocks of companies hit hardest by the virus.

The mixed feeling has led to truncated trading in Asia with the former Japan Asia-Pacific stock index falling 0.76% while Japan’s Nikkei gained 0.2%.

Chinese mainland shares fell 1

.7%, weighed down by concerns about economic recovery as data showed a slowdown in the country’s money supply and rising bank lending.

European stocks are expected to open lower, with the future of the Euro Stoxx 50 falling 0.6%.

On Wall Street, the S&P 500 grabbed a seven-day winning streak after reaching its all-time peak in February, shortly before the COVID-19 global explosion.

The downturn came as the political row between the White House and Congressional Democrats over coronavirus relief continued for a fourth day.

By banning a bipartisan deal, the U.S. economy could be left with the measures that U.S. President Donald Trump demanded Saturday through executive orders to bypass Congress.

“We have a lot of uncertainty. It seems that it is becoming more difficult for both sides to compromise as the election approaches … Trump’s proposals would be smaller than the markets expected. The question is whether they are also valuable, “said Junpei Tanaka, strategist at Pictet.

U.S. election campaigns look steamy after presidential candidate Joe Biden elected Senator Kamala Harris as his running mate.

The 10-year yield of the US Treasury plunged to 1 point point at 0.647% in Asia after recording a month of 0.661% in previous trade.

At the forefront of selling defenses ahead of the biggest ever 10-year auction, later in the day, bonds have lost some of their safe haven even for the rising hopes of COVID-19 vaccines.

Russian President Vladimir Putin said on Tuesday that his country was the first to grant regulatory approval to a COVID-19 vaccine after less than two months of human testing.

As Moscow’s decision raised eyebrows, news raised hopes that some of the vaccines currently in development would become available sooner than expected.

Investors bought shares of the hospitality industry and other value-driven stocks, leading the center of the old Dow Jones economy to surpass the technology-focused Nasdaq.

Globally, the MSCI Value Index has risen 1.6% so far this week while the MSCI Growth Index has lost 1.2%.

The most dramatic mass took place in precious metals.

Gold fell 1.6% to $ 1,881.4 an ounce, a day after suffering its biggest daily drop in seven years. Silver lost 3.2% to $ 23.99 an ounce, after falling 15% on Tuesday.

However, Michael Hsueh, Commodities & FX Strategist at Deutsche Bank in New York said, there is a good chance that this week’s downturn will attract new buyers.

“In today ‘s example, news about vaccines may not be enough to change the macro narrative, so much so that it is seen as a medical error in rapid progress through testing procedures,” he said, referring to the Russian vaccine.

Major currencies changed slightly, with the euro almost flat at $ 1.1728 and the yen also moving slightly to 107.27 per dollar.

The New Zealand dollar fell 0.4% after the country closed Auckland after four new COVID-19 cases and the country’s central bank took a dovish stance.

Oil prices rose after falling more than expected in U.S. inventories, with Brent down 0.6% to $ 44.75 a barrel. US crude rose 0.5% to $ 41.80.

Reporting by Hideyuki Sano in Tokyo, Lawrence Delevingne in Boston; additional reporting by Tomo Uetake in Sydney, Edited by Sam Holmes

Our standards:Principles of Trust of Thomson Reuters.

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