By RTT News, September 20, 2013, 05:06:00 AM EDT
(RTTNews.com) - Asian stocks fell broadly on Friday, reflecting uncertainty over Federal Reserve plans as the unexpected monetary policy announcement by the central bank to maintain status quo on QE3 and its downbeat economic assessment sparked confusion about the timing and scale of the pull-back. Investors took some profits off the table amid holidays in China, Hong Kong, South Korea and Taiwan.
International Monetary Fund Chief Christine Lagarde said she sees subdued global growth ahead despite signs of recovery taking hold in the U.S and the euro area. Momentum is slowing in many emerging markets, reflecting the need to address imbalances that have made them more vulnerable to recent market turbulences, she said in a speech to business leaders at the U.S. Chamber of Commerce in Washington, D.C.
Japanese shares eased slightly ahead of the long weekend. The benchmark Nikkei slid 0.2 percent to 14,742.42 following the previous session's 1.8 percent rally. The broader Topix index, however, edged up 0.3 percent. Exporters such as Fanuc and Kyocera fell over a percent on profit taking as the U.S. dollar traded at the lower 99 yen level in early deals. Realty stocks Mitsui Fudoson and Sumitomo Realty & Development lost over a percent each despite data showing rising land prices in greater Tokyo, Osaka and Nagoya for the first time in five years.
Tokyo Electric Power declined 2.3 percent on reports that the utility will have to earmark an additional 1 trillion yen over the next 10 years to pay for dismantling the damaged nuclear reactors at its Fukushima Daiichi plant. Toyota Motor rose 1.3 percent and Tokyo Electron advanced 1.8 percent. Shiseido soared 5.8 percent on a Citigroup upgrade to "buy" from "sell."
Australian shares fell from a five-year high hit the day before on confusion about the future direction of U.S. monetary policy. The benchmark S&P/ASX 200 slipped 0.4 percent to 5,277. Miners paced the declines, with BHP Billiton closing 0.8 percent lower after it opened a $US1.5 billion gas plant expected to supply 20 percent of Western Australia's domestic gas for the next two decades. Rival Rio Tinto lost 1.1 percent. Among the major banks, Commonwealth ended flat, but ANZ, NAB and Westpac fell between 0.5 percent and 0.7 percent. Investors lapped up defensive stocks, lifting retailers Woolworths up 0.7 percent and Wesfarmers up 0.3 percent.
New Zealand shares fell for the first time in two weeks as investors locked in some of the recent gains. The benchmark NZX-50 dropped half a percent to 4,730, with 23 of its stocks retreating. Fletcher Building, the nation's largest construction company, led the decliners with a 2.5 percent loss. Job advertisements in New Zealand decreased in August after recording strong growth in the previous month, data released by the ANZ Bank New Zealand showed. The number of job advertisements published in newspapers and the internet dropped a seasonally adjusted 1.4 percent month-over-month in August following a 4 percent increase in July.
India's Sensex was tumbling 2.2 percent after the Reserve Bank of India surprised markets with a 25 basis points hike in the repo rate. New central bank chief Raghuram Rajan eased liquidity through reduction in marginal standing facility rate by 75 basis points to 9.5 percent, but at the same time sent clear signal to markets that inflation remains a concern. Rajan said that the hike in the key policy rate cannot be viewed as negative for growth.
Elsewhere, Indonesia's Jakarta Composite index was down 1.7 percent and Singapore's Straits Times was losing 0.3 percent, while Malaysia's KLSE Composite was up half a percent.
Both Philippines and Taiwan issued alerts against 'Typhoon Usagi' which was 560 kilometers east-southeast of Taiwan and 360 kilometers from northern Philippines on Friday morning.
On Wall Street, stocks turned in a relatively lackluster performance overnight as investors paused for breath following the previous session's Fed-inspired rally. Traders also digested a slew of economic reports painting a positive picture of the economy. The tech-heavy Nasdaq edged up 0.2 percent, but the Dow dipped 0.3 percent and the S&P 500 slipped 0.2 percent.
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