HONG KONG (Reuters) – Asian stocks fell on Tuesday and European stock futures fell, as a senior Chinese official expressed caution about the risk of asset bubbles in foreign markets and the recent liquidation of the bond market still weighed. about investor sentiment.
European markets seemed set to open lower, with Euro Stoxx 50 futures falling 0.38% and London’s FTSE falling 0.4%. Germany’s DAX fell 0.49%.
The broader MSCI index for Asia Pacific stocks outside Japan fell 0.33%, losing initial gains. Japan’s Nikkei fell 0.85% as some investors recorded profits in defensive energy and utility stocks before the end of this month’s fiscal year.
Australian stocks ended slightly lower on Tuesday, as the market appeared to show a silent response to the central bank’s decision to maintain interest rates, as expected.
The S & P / ASX 200 index fell 0.4% to 6,762.3 at the close of the session, having risen up to 1% during the session.
Mainland China and Hong Kong stocks reversed their course to trade lower in the afternoon session after a senior regulator expressed concerns about the risk of bubbles bursting in foreign markets, and said Beijing is considering effective measures to manage flows capital to avoid turbulence in the domestic market.
“Financial markets are trading at high levels in Europe, the United States and other developed countries, which goes against the real economy,” said Guo Shuqing, head of China’s Banking and Insurance Regulatory Commission, at a news conference.
Chinese blue chips fell 1.78%, while Hong Kong’s Hang Seng lost 1.45%.
Investors are now eyeing the annual session of China’s parliament that begins on Friday, which is set to chart a course for economic recovery and reveal a five-year plan to prevent stagnation.
US stocks rose overnight, with the S&P 500 registering its best day in nearly nine months, while the bond markets calmed down after a month-long liquidation.
“Risk appetite has returned to the markets as investors have removed concerns about higher interest rates and focused on the recent strength of manufacturing data,” ANZ analysts wrote in a research note.
US equities became turbulent last week, when a liquidation of Treasury bills pushed the 10-year Treasury yield to a 1.614% rise in one year. The 10-year yield was falling after trading at 1.4119%.
Bitcoin fell 1.93%, to $ 48,669, after rising nearly 7% on Monday, after last week’s bond loss cooled, with Citi saying the most popular cryptocurrency was at a “hot spot.” inflection “and could become the preferred currency for international trade.
However, the demand for riskier assets has not hurt the dollar, generally considered a safe-haven currency, as investors are betting on accelerated growth and inflation in the United States. The US dollar index gained 0.207% in afternoon trading against a basket of currencies, to stand at 91.205, in view of a three-week high hit overnight.
The Australian dollar fell 0.14% at $ 0.7758 after the RBA meeting.
A stronger dollar weighed on gold, and the precious metal was on the defensive at $ 1,715,8400 an ounce on Tuesday.
The exuberance in risky assets has not helped the energy markets. Oil prices fell more than 1% overnight after data showed that China’s manufacturing activity growth fell to a nine-month low in February, due in part to interruptions during the Lunar New Year holiday. There were also fears among energy investors that OPEC could increase global supply after a meeting this week.
Brent crude fell 1.35% to $ 62.83 a barrel, while US West Texas Intermediate crude fell 1.34% to $ 59.83.
Julie Zhu reporting in Hong Kong; Additional reporting by Koh Gui Qing in New York; Edited by Sam Holmes and Lincoln Feast.