Asian shares drifted off on Thursday as uncertainty over the outlook for both U....
SYDNEY - Asian shares drifted off on Thursday as uncertainty over the outlook for both U.S. interest rates and the chance of global fiscal stimulus sucked the life out of markets.
In early European trades, the pan-region Euro Stoxx 50 futures slipped 0.2% as did London’s FTSE futures. Germany’s DAX futures eased 0.3% while France’s CAC 40 futures were off about 0.4%.MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.5% in light volumes. “These will be the first major economic releases for August and will be closely watched, especially given the focus on growth and the global collapse in yields,” analysts at JPMorgan said in a note.
Indeed, while a “couple” of Fed members favored a deeper cut of half a point, “several” favored no change at all. “The key message from the Fed minutes is that the 25 basis-point cut in July was just a calibration, a mid cycle adjustment and not the start of a new easing cycle,” said Rodrigo Catril, a senior FX strategist at National Australia Bank.
“If he sticks to the old language as is most likely, it would affirm that he is still confident that the strength of consumption, in combination with modest Fed easing, will be sufficient to keep the recovery broadly on track.”The dollar had already bounced overnight, and was last at 98.311 against a basket of currencies from a low of 97.948. It also reached 106.60 yen from Wednesday’s trough of 106.21.
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