WELLINGTON, Jan 13 (Reuters) - Asian stocks are set to fall
on Wednesday after China took a step towards tighter monetary
policy, sending growth sensitive assets in major markets lower.
On Tuesday, the People's Bank of China raised bank reserve requirements, apparently prompted by concerns that a renewed surge in bank lending was flooding the economy with too much cash, as the world's third-largest economy continues to power ahead. For more see
Growth sensitive assets fell on the news, led by drops in commodity-sensitive currencies on fears that weaker Chinese growth could hamper the global recovery.
Asian stocks and bonds are expected to be hit when markets open, with the Shanghai Composite seen down around 2 percent.
Losses could be aggravated by falls on Wall Street after stocks lost as much as 1.3 percent on Tuesday on a weak result from Alcoa and concerns about a potential government levy on banks.
Major emerging market funds were lower, with the iShares FTSE/Xinhua China 25 fund down 2.4 percent, the iShares MSCI Hong Kong Index fund down 1 percent and the iShares MSCI Emerging Market fund down 1.6 percent.
Japan's Nikkei average is poised to open weaker, with exporters also likely to be hit by a stronger yen. Nikkei futures trading in Chicago were 90 points lower than the Osaka close.
British and European shares fell from 15 month highs as the China move and a weak start to the U.S. earnings season dampened sentiment.
Australian shares are also set to fall, with share index futures last trading at 4,841, a 58.5-point discount to the underlying index's close on Tuesday.
HEADLINES: > Wall St drops on bank levy worries, Alcoa > US trade gap widens as imports jump > In boost to Kraft, Ferrero out of Cadbury race > US FDIC floats plan to tie bank pay to fee levels > China surprises with reserve hike, markets hit > Calls grow for inquiry into Fed role in AIG issue > USDA forecasts record corn crop; futures tumble > American sweetens offer as JAL shares plunge > Tiffany, Signet sales grow as splurges return > Venezuela raids price gougers after devaluation
KEY INDEXES pct change
Bank of New York Asia ADR index -0.11
Dow Jones Industrial Average -0.34
Nasdaq Composite Index -1.30
MSCI Asia Pacific ex-Japan -0.64
Nikkei futures in Chicago 10,800
Nikkei futures in Osaka 10,890
TOP ASIA EVENTS:
For more Asian company earnings, see
AUSTRALIA - Westpac consumer sentiment survey, January
HONG KONG - Invesco news conference
STH KOREA - December unemployment rate
(Reporting by Adrian Bathgate)
((adrian.bathgate@reuters.com; +64-4-4714233; Reuters Messaging: adrian.bathgate.reuters.com@reuters.net)) For top Asian company news, double click on: U.S. company news European company news U.S. weekly outlook European weekly outlook Forex news Global Economy news Tech/Telecoms/Media Banking news Political/General news Asia Macro data ASIA STOCK MARKETS: Pan-Asia........ Japan....... S.Korea... S.E. Asia....... Hong Kong... Taiwan.... Australia/NZ.... India....... China..... DIARIES & DATA: IPO diary/data Asia earnings diary U.S. earnings diary European diary Hong Kong diary Wall Street Week Ahead Eurostocks Week Ahead LIVE PRICES & DATA: World Stocks Asian Stocks Dow Jones/NASDAQ / Nikkei FTSE 100 Debt Currency rates Keywords: MARKETS ASIA (If you have a query or comment on this story send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
On Tuesday, the People's Bank of China raised bank reserve requirements, apparently prompted by concerns that a renewed surge in bank lending was flooding the economy with too much cash, as the world's third-largest economy continues to power ahead. For more see
Growth sensitive assets fell on the news, led by drops in commodity-sensitive currencies on fears that weaker Chinese growth could hamper the global recovery.
Asian stocks and bonds are expected to be hit when markets open, with the Shanghai Composite seen down around 2 percent.
Losses could be aggravated by falls on Wall Street after stocks lost as much as 1.3 percent on Tuesday on a weak result from Alcoa and concerns about a potential government levy on banks.
Major emerging market funds were lower, with the iShares FTSE/Xinhua China 25 fund down 2.4 percent, the iShares MSCI Hong Kong Index fund down 1 percent and the iShares MSCI Emerging Market fund down 1.6 percent.
Japan's Nikkei average is poised to open weaker, with exporters also likely to be hit by a stronger yen. Nikkei futures trading in Chicago were 90 points lower than the Osaka close.
British and European shares fell from 15 month highs as the China move and a weak start to the U.S. earnings season dampened sentiment.
Australian shares are also set to fall, with share index futures last trading at 4,841, a 58.5-point discount to the underlying index's close on Tuesday.
HEADLINES: > Wall St drops on bank levy worries, Alcoa > US trade gap widens as imports jump > In boost to Kraft, Ferrero out of Cadbury race > US FDIC floats plan to tie bank pay to fee levels > China surprises with reserve hike, markets hit > Calls grow for inquiry into Fed role in AIG issue > USDA forecasts record corn crop; futures tumble > American sweetens offer as JAL shares plunge > Tiffany, Signet sales grow as splurges return > Venezuela raids price gougers after devaluation
KEY INDEXES pct change
Bank of New York Asia ADR index -0.11
Dow Jones Industrial Average -0.34
Nasdaq Composite Index -1.30
MSCI Asia Pacific ex-Japan -0.64
Nikkei futures in Chicago 10,800
Nikkei futures in Osaka 10,890
TOP ASIA EVENTS:
For more Asian company earnings, see
AUSTRALIA - Westpac consumer sentiment survey, January
HONG KONG - Invesco news conference
STH KOREA - December unemployment rate
(Reporting by Adrian Bathgate)
((adrian.bathgate@reuters.com; +64-4-4714233; Reuters Messaging: adrian.bathgate.reuters.com@reuters.net)) For top Asian company news, double click on: U.S. company news European company news U.S. weekly outlook European weekly outlook Forex news Global Economy news Tech/Telecoms/Media Banking news Political/General news Asia Macro data ASIA STOCK MARKETS: Pan-Asia........ Japan....... S.Korea... S.E. Asia....... Hong Kong... Taiwan.... Australia/NZ.... India....... China..... DIARIES & DATA: IPO diary/data Asia earnings diary U.S. earnings diary European diary Hong Kong diary Wall Street Week Ahead Eurostocks Week Ahead LIVE PRICES & DATA: World Stocks Asian Stocks Dow Jones/NASDAQ / Nikkei FTSE 100 Debt Currency rates Keywords: MARKETS ASIA (If you have a query or comment on this story send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.