Picture used for illustrative purpose. File
Asian shares dropped on Thursday, set for their worst day in two months, as warnings from US Federal Reserve officials underscored investor worries over the resilience of an economic recovery from the coronavirus pandemic.
MSCI's broadest index of Asia-Pacific shares outside Japan slumped 1.93% in the afternoon session on broad losses across the region, putting it on track for its biggest daily drop since July 16.
The MSCI index is also set for its biggest weekly drop since March, down more than 4% so far this week. Chinese blue-chips dropped 1.6%, Hong Kong's Hang Seng fell 1.7%, Seoul's KOSPI sank 2.59% and Australian shares fell 0.81%. Japan's Nikkei declined 1.11%.
US Federal Reserve Vice Chair Richard Clarida said on Wednesday that the US economy remains in a "deep hole" of joblessness and weak demand, and called for more fiscal stimulus, noting that policymakers "are not even going to begin thinking" about raising interest rates until inflation hits 2%.
"Have we overpriced the rebound in the economy? After the stern warning from Clarida, I say we have," said Stephen Innes, chief global markets strategist at AXI.
US stocks fell on Wednesday after data showed business activity slowed in September, with gains at factories more than offset by a retreat at services industries.
Investors now await weekly data due later on Thursday, which is expected to show US jobless claims fell slightly but remained elevated, indicating the world's largest economy is far from recovering.
Markets rose last week after unexpectedly strong U.S. jobs data despite some American states reporting record new coronavirus infections.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.3% and further away from a four-month top hit last week. Japan's Nikkei shed 2.2% and Chinese blue chips 0.9%.
All major Asian indexes were upbeat with Japan's Nikkei rising 0.1%, China's blue-chip index adding 1.7% while Hong Kong's Hang Seng index climbed 1.8%.
Asian shares posted gains on Monday and the euro rose to four-month highs, as EU leaders appeared to make some headway after three days of haggling on a plan to revive their economies, even as coronavirus cases increased in many countries.
The Reserve Bank of India (RBI), the country’s central bank, on Friday has kept key interest rates steady to subdue the unabatedly high inflation rate. However, the Monetary Policy Committee (MPC) of the central bank (CB) maintained the growth-oriented
London FTSE 100 rose 0.8% as crude prices gained while in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.78%.
Global trade, shipping business and supply chain industry will return to growth next year following positive news on the coronavirus vaccine that will help restore confidence in the economy, experts say.
The Indian-based firm Indus Net Technologies (INT) is keen to expand its operations across the Gulf region. We have been serving clients in the Middle East for over a decade. However, we will now look for a stronger presence in this market from 2021 onwards.