Asia stocks wary, dollar slips before Fed Chair Yellen's speech
SINGAPORE/TOKYO – Asian stocks were largely steady on Friday, with modest losses in some markets and gains in others reflecting nervousness before a keenly anticipated speech by U.S. Federal Reserve Chair Janet Yellen.
European markets are also heading for a flat start, with financial spreadbetter CMC Markets expecting Britain’s FTSE 100 and Germany’s DAX to open little changed, and France’s CAC 40 to begin the day down 0.1 percent.
“The expectation surrounding (Yellen’s speech) has been out of all proportion to the likely outcome, which in all probability is likely to be fairly benign,” Michael Hewson, chief market analyst at CMC Markets in London.
“Some in the markets are slowly coming to the realisation that central bankers the world over are fumbling around in the dark as they try to reinvigorate their economies,” he added.
MSCI’s broadest index of Asia Pacific shares outside Japan was little changed as investors awaited some direction from Yellen on whether the Fed might raise interest rates this year. Yellen will speak at 1400 GMT at the annual gathering of global central bankers in Jackson Hole, Wyoming.
The Asia-Pacific benchmark is on track for a 0.3 percent loss for the week, but is up nearly 9 percent so far this year.
Japan’s Nikkei extended losses to close down 1.2 percent, bringing declines for the week to 1.1 percent. South Korea’s Kospi dropped 0.2 percent, on track for a 0.9 percent slide for the week.
Chinese shares, however, recouped the previous session’s losses, with some traders attributing the gains to regulators’ denial that insurance money is exiting the market.