Asian shares lower on Fed tapering concerns

An investor gestures at a private securities company in Shanghai, China, Wednesday, Dec. 11, 2013. Asian stocks eased Thursday, following a lead from Wall Street, as investors looked to next week’s Federal Reserve policy meeting with speculation growing that the bank will cut its stimulus program. AP PHOTO

HONG KONG—Asian markets eased Thursday, following a lead from Wall Street, as investors looked to next week’s Federal Reserve policy meeting with speculation growing that the bank will cut its stimulus program.

While a bipartisan budget deal in Washington fuelled hopes that another government shutdown will be avoided next month, it is believed that the deal will also give the Fed more room to wind down the bond-buying scheme.

Tokyo fell 1.12 percent, or 173.24 points, to close at 15,341.82, while Seoul slipped 0.51 percent, or 10.04 points, to 1,967.93 and Sydney ended 0.82 percent, or 41.7 points, lower at 5,062.5.

Shanghai closed a tad lower, dipping 1.37 points to 2,202.80 while Hong Kong lost 0.51 percent, or 120.12 points, to end at 23,218.12.

With few other catalysts to drive business, dealers are playing a wait-and-see game ahead of the Fed’s policy announcement next week, with opinion split on whether it will begin reeling the stimulus in this month or early next year.

The Fed’s $85 billion-a-month scheme has been credited with fuelling a global equities rally this year as it has supplied vast sums of cheap money to investors.

A series of strong recent data—including falling unemployment and strong economic growth figures—have strengthened the argument for a December cut, while this month a top Fed official indicated a small reduction could be on the cards.

Added to that was Tuesday’s Democratic-Republican two-year budget deal which, if passed by Congress, would avert a shutdown crisis such as the one that paralysed Washington in October.

Wall Street’s initial reaction to that deal was a sell-off, with the Dow losing 0.81 percent, the S&P 500 off 1.13 percent and the Nasdaq down 1.40 percent. Analysts said the indexes were also subject to profit-taking after enjoying immense rallies this year.

On forex markets, the dollar edged up to 102.79 yen in afternoon trade, against 102.40 yen in New York on Wednesday.

The euro fetched $1.3793, compared with $1.3785, adding to four straight days of advances against the greenback. The single currency also fetched 141.80 yen compared with 141.19 yen.

In oil trade, New York’s main contract, West Texas Intermediate (WTI) for January delivery, was up 16 cents at $97.60 in afternoon trade while Brent North Sea crude for January added 19 cents to $109.89.

Gold fetched $1,242.75 at 1050 GMT compared with $1,256.40 late Wednesday.

In other markets:

— Bangkok slid 0.96 percent, or 13.14 points, to 1,356.21.

Telecoms company True Corporation fell 6.70 percent to 8.35 baht, while coal producer Banpu lost 2.33 percent to 31.50 baht.

— Jakarta fell 1.39 percent, or 59.53 points, to 4,212.218.

Bank Negara Indonesia dropped 3.14 percent to 3,850 rupiah, while Hero Supermarket gained 1.03 percent to 2,450 rupiah.

— Kuala Lumpur dived 0.49 percent, or 8.95 points, to 1,833.87.

Tenaga Nasional fell 2.7 percent to 11.00 ringgit while MISC fell 2.4 percent to 5.37. DiGi.com added 1.5 percent to 4.83 ringgit.

— Manila shed 2.14 percent, or 126.21 points, to 5,762.53.

Metropolitan Bank fell 1.94 percent to 70.70 pesos, Philippine Long Distance Telephone eased 1.29 percent to 2,610 pesos and International Container Terminal Services retreated 0.99 percent to 100.50 pesos.

— Mumbai fell 1.16 percent, or 245.80 points, to 20,925.61.

Private vehicle manufacturer Tata Motors fell 4.55 percent to 360.60 rupees while private Suzlon Energy fell 3.18 percent to 9.73 rupees.

— Singapore dropped 0.06 percent, or 1.70 points, to 3,059.04.

Oversea-Chinese Banking Corporation eased 0.31 percent to Sg$9.80 while agribusiness company Wilmar International rose 0.30 percent to Sg$3.39.

— Taipei fell 0.86 percent, or 72.44 points, to 8,361.33.

Taiwan Semiconductor Manufacturing Co. lost 1.9 percent to end at Tw$103.0 while Hon Hai rose 0.38 percent to Tw$78.5.

— Wellington was flat, edging up 3.89 points to 4,708.20.

Telecom added 1.31 percent to NZ$2.32, Trade Me was off 0.71 percent at NZ$4.19 and Air New Zealand was steady at NZ$1.64.