As the investors are expecting that the Fed may taper its stimulus sooner; Asian stocks extended losses today. On a dismal trading day, Japan’s Nikkei 225 lost 1.6 percent to 15,265.75 and Hong Kong’s Hang Seng dropped 0.7 percent to 23,178.97. According to market observers, the market in Asian economies was slow as many of them are wary about the future of U.S. stimulus.
Whereas China’s Shanghai Composite eased 0.1 percent to 2,201.84, the other regional economies like Australia, India, Taiwan and Southeast Asia were down to some extent. Additionally, as the U.S. lawmakers look set to agree on a modest budget agreement is sending negative signals among investors.
According to the sources the U.S. law makers are agreeing to restores about $63 billion in across-the-board automatic spending cuts. The measure is aimed to help prevent another partial shutdown of the U.S. government. Earlier, the 16-day shutdown in October crimped economic growth and hurt consumer confidence to great extent and the country does not want to see it again.
The major losers in today’s stock were the ones from health care sector. Whereas Laboratory Corporation of America fell after cutting its full-year earnings forecast, Quest Diagnostics, a major competitor, also dropped to great extent. A similar trend was seen in the S&P 500 index fell 1.2 percent to 1,782.22 which is the biggest decline for the index since Nov. 7.
Following the downward movement, even the Dow Jones industrial average dropped 0.8 percent to 15,843.53 yesterday. According to market observers benchmark US crude for January delivery was down and declined 6 cents to $97.38 a barrel in electronic trading on the New York Mercantile Exchange. Similar trend was seen in the contract which declined by $1.07 to close at $97.44.
Regional Markets in Asia
The stocks in regional market in Korea, Japan, China, Hong Kong and India declined to great extent. Whereas Japan’s Topix index slid 0.7 percent, a similar trend was seen in Australia’s S&P/ASX 200 Index which lost 0.8 percent. S&P/ASX 200 Index fell for a sixth day in the longest losing streak in 17 months.
A similar trend was followed by South Korea’s Kospi index which retreated 0.5 percent as Doosan Heavy lost 4.5 percent to 32,000 won. Whereas Hong Kong’s Hang Seng Index dropped 0.5 percent, a similar trend was seen in China’s Shanghai Composite which fell 0.1 percent. Even India’s S&P BSE Sensex Index lost 1.2 percent after the last week’s bumper performance.
To contact the reporter of this story: Jonathan Millet at email@example.com