Stock markets fluctuated on Monday as investors took a step back after last week’s rally fueled by the Federal Reserve’s interest rate cut.
Tokyo led the winners after Japan’s central bank said it would sell off its huge stock of exchange-traded funds gradually. It sparked a sell-off on Friday by announcing plans to offload the holdings as part of a shift away from its loose monetary policy.
Investors also took some heart from talks between Donald Trump and Chinese leader Xi Jinping on Friday that the US president said “made progress on many very important issues” including a deal to sell the blockbuster social media app TikTok.
He added that the pair would meet Xi on the sidelines of an Asia-Pacific Economic Cooperation summit in South Korea at the end of next month and that he would travel to China next year.“While lacking apparent substance, it does look to have helped create a positive atmosphere to enable extension of the ongoing US-China detente,” said National Australia Bank’s Ray Attrill.
Equities have enjoyed a healthy run-up in recent months on optimism that the US central bank will lower borrowing costs as worries over a softening labour market trump stubbornly high inflation.
Tokyo was the standout performer on Monday, rising one per cent, after the Bank of Japan said it would sell its ETFs, bought as part of a campaign of monetary easing aimed at kickstarting the sluggish economy gradually.Monday’s gains came after officials said they would trim the holdings steadily, at a pace observers said would take around 100 years to complete.
There were also gains in Shanghai, Sydney, Seoul and Taipei, while Hong Kong, Singapore, Wellington, Manila, Bangkok and Jakarta fell.
Mumbai edged down as India’s $283 billion tech sector took a hit after Trump on Friday ordered an annual $100,000 fee be added to new H-1B skilled worker visas, creating potentially major repercussions for the tech industry where such permits are prolific.
Shares in Tata Consultancy Services fell three per cent and rival Infosys shed 2.7 per cent.
London, Paris and Frankfurt dipped.
Key figures at around 0810 GMTIts announcement on Friday that it planned to offload its stockpile sent shivers through Japanese markets, sending the Nikkei sharply lower
Tokyo – Nikkei 225: UP 1.0 per cent at 45,493.66 (close)
Hong Kong – Hang Seng Index: DOWN 0.8 per cent at 26,344.14 (close)
Shanghai – Composite: UP 0.2 per cent at 3,828.58 (close)
London – FTSE 100: DOWN 0.1 per cent at 9,207.22
Euro/dollar: UP at $1.1750 from $1.1745 on Friday
Pound/dollar: UP at $1.3482 from $1.3472
Dollar/yen: UP at 148.05 yen from 147.90 yen
Euro/pound: DOWN at 87.16 pence from 87.18 pence
West Texas Intermediate: UP 0.5 per cent at $63.01 per barrel
Brent North Sea Crude: UP 0.5 per cent at $67.03 per barrel
New York – Dow: UP 0.4 per cent at 46,315.27 (close)