Asian Shares Principally Decrease After Blended Day on Wall Avenue | Enterprise Information
From ELAINE KURTENBACH, AP Business Writer
BANGKOK (AP) – After a mixed session on Wall Street, stocks in Asia were largely lower on Thursday as losses from tech and industrial companies offset other gains.
Shanghai advanced after the reopening after the New Year holiday. Shares fell in Tokyo, Hong Kong and Seoul.
The yield on the 10-year Treasury note was 1.27%, close to its highest level since the beginning of the year. Bond rates have risen on expectations that the pandemic rebound will drive inflation higher, and this has limited buying enthusiasm as investors sold off to secure recent gains.
The US Department of Labor reported Wednesday that US wholesale prices rose a record 1.3% in January, led by strong increases in health and energy prices. The unexpectedly high surge was the largest one-month gain on records from 2009.
The Commerce Department, underlining signs of recovery, said US retail sales rose 5.3% on a seasonally adjusted basis in January. This is the largest increase since June and much larger than forecast.
Optimism that the introduction of coronavirus vaccines will set the stage for stronger economic growth in the second half of the year has propelled stocks higher.
The Shanghai Composite Index gained 0.6% to 3,678.11 and the S & P / ASX 200 remained unchanged at 6,885.90. The Japanese Nikkei 225 lost 0.2% to 30,236.09 while the Hang Seng in Hong Kong lost 1.2% to 30,725.47. In South Korea, the Kospi gave up 1.5% to 3,086.66.
The return of the 10-year Ministry of Finance was constant at 1.28% and thus close to the highest level since the beginning of the year. The rise in bond yields has raised some concerns about the potential for higher inflation, but it has also been a sign that the outlook for economic growth remains good.
On Wednesday, the S&P 500 fell less than 0.1% to 3,931.33 after returning an early gain. The tech-heavy Nasdaq network fell 0.6% to 13,965.49.
The Dow Jones Industrial Average rose 0.3% to 31,613.02, a second record high in a row. The modest recovery was largely due to gains at Verizon Communications and Chevron, which rose after Warren Buffett’s Berkshire Hathaway made major new investments in them in the latter half of last year.
Small company stocks were harder hit, and the Russell 2000 Smaller Company Index fell 0.7% to 2,256.11.
Energy prices rose again, adding to a sharp rise the previous day due to the cold weather that hit much of the US
The US benchmark crude rose in electronic trading on the New York Mercantile Exchange by 56 cents to $ 61.70 a barrel. On Wednesday it rose $ 1.09 to $ 61.14 a barrel. Brent crude, the international standard, rose 74 cents to $ 65.08 a barrel.
The strong retail sales seem to heighten perceptions that inflation is picking up even before the Biden administration has implemented its proposed $ 1.9 trillion stimulus package and other spending to get the economy back on solid foundations.
Ultimately, this could lead the Federal Reserve to rethink its current policy of keeping interest rates extremely low.
Minutes of the January Fed meeting released Wednesday afternoon showed that the central bank believed the pandemic still posed significant risks to the economy. The minutes also reflected widespread support from Fed officials to keep interest rates low in order to stimulate the economy and help millions of Americans regain lost jobs.
Fed Chairman Jerome Powell has warned that inflation could accelerate for some time in the coming months as the country opens up. But he and many private economists believe this will only be a temporary increase, and not a sign that inflation is spiraling out of control.
Last month’s increase in retail sales was largely driven by the $ 600 economic checks sent to most Americans in late December and early January. The data shows that Americans hit by the recession are willing to spend money on essentials, not save funds – which is the goal of stimulus checks.
This potentially means that additional boost, likely in the form of $ 1,400 checks in the $ 1.9 trillion stimulus plan, is likely to give the economy a much needed boost.
The US dollar rose from 105.89 yen to 105.92 Japanese yen. The euro rose from $ 1.2042 to $ 1.2047.
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