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Asian stocks mixed despite easing concerns on Syria

/ 10:59 AM August 30, 2013

HONG KONG – Asian markets were mixed on Friday as upbeat US economic growth data and easing concerns about an imminent strike on Syria were offset by mild profit-taking following the previous day’s gains.

The quiet trade brought an end to a torrid month for global shares and currencies dominated by fears over the end of the US Federal Reserve’s stimulus program as well as the possibility of military action in the Middle East.

Tokyo eased 0.67 percent by the break, Hong Kong was 0.14 percent lower, Sydney added 0.27 percent and Seoul was 0.48 percent higher while Shanghai edged up 0.10 percent.


Wall Street provided a positive lead after the Commerce Department said the US economy grew at an annual rate of 2.5 percent in the April-June quarter, much better than the original estimate of 1.7 percent.

It said stronger consumer spending and exports underpinned the pickup from the first quarter’s sluggish 1.1 percent pace, while exports were stronger and imports slower than originally estimated.

The Dow rose 0.11 percent, the S&P 500 added 0.20 percent and the Nasdaq increased 0.75 percent.

Investors were a little more buoyant as the likelihood of a US-led attack on Syria looked less imminent, as lawmakers in London voted against such a move.

And while the White House signalled it was ready to go it alone in punishing Syria for a deadly chemical attack on its civilians, analysts said they did not expect a strike this weekend, as was initially thought.

“There just seems to be less urgency about an attack any time soon,” said Alec Young, global equity strategist for S&P Capital IQ. “The stress level has come down a little.”

Expectations of a military strike against Syria sent shares diving this week as it fuelled concerns that a wider conflict was looming in the oil-rich region.

On forex markets Friday the dollar – which sank below 97 yen this week- was at 98.21 yen, compared with 98.32 yen late in New York.


Currency traders seemed unmoved by data out of Tokyo showing July consumer prices rose at their fastest pace in almost five years, giving cheer to the government’s easy-money policy. The rises were mostly attributed to the weaker yen making energy imports more expensive.
The euro traded at $1.3244, from $1.3241, while it also fetched 130.07 yen from 130.18 yen.
Emerging markets currencies were also slightly up. The Indian rupee was at 65.60 to the dollar, well down from the record low of 68.80 on Wednesday, partly thanks to central bank moves to support the unit.

The Indonesian rupiah was at 10,920 to the dollar, compared with levels above 11,000 this week, while the greenback bought 32.06 Thai baht down from 32.29.

Emerging markets have been hammered this month as dealers bet on the Fed winding down its bond-buying stimulus, which has helped fuel an investment splurge in developing economies over the past year.

Among the worst hit markets has been Manila, which has lost 10.5 percent this year, while Jakarta has fallen 11 percent and Bangkok 9.2 percent.

Oil prices declined further after peaking on Wednesday at multi-month highs because of supply fears linked to the Syria crisis.

New York’s main contract, West Texas Intermediate for delivery in October, was down $1.50 at $107.30 a barrel, while Brent North Sea crude for October eased $1.27 to $113.89.

WTI touched a two-year-high of $112.24 Wednesday while Brent rose to $117.34 at one point, its highest for six months.

Gold cost $1,407.25 an ounce at 0230 GMT, up from $1,409.96 late Thursday.

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TAGS: Asia, economy, markets, stocks, syria, Trade, Violence
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