Asian stock markets mostly lower; Europe up in early trading
SEOUL, Korea — Global stock markets were mixed on Wednesday as investors awaited the outlines of tax overhaul plans by U.S. President Donald Trump while news headlines on geopolitical tensions surrounding North Korea have quieted.
KEEPING SCORE: European markets opened with modest gains. Britain’s FTSE 100 rose 0.2 per cent in early trading to 7,298.35. France’s CAC 40 added 0.1 per cent to 5,275.97 and Germany’s DAX gained 0.5 per cent to 12,669.64. Futures augured a tepid start on Wall Street with S&P and Dow futures both up 0.1 per cent.
ASIA’S DAY: Asian markets closed mostly lower. Japan’s Nikkei 225 fell 0.3 per cent to 20,267.05 and South Korea’s Kospi dipped less than 0.1 per cent to 2,372.57. Australia’s S&P/ASX 200 lost 0.1 per cent to 5,664.30. But Hong Kong’s Hang Seng index rose 0.5 per cent to 27,642.43. China’s Shanghai Composite Index added 0.1 per cent at 3,345.27. Stocks in Southeast Asia were mixed.
U.S. POLITICS WATCH: House Republicans and Trump administration officials are due to give details of plans for a long-awaited tax proposal on Wednesday, which are expected to reduce individual and corporate tax rates. While analysts expect not much will be done immediately, with the absence of other headline-dominating news, it will still be the key event.
ANALYST’S TAKE: “With the focus back on monetary policy and particularly fiscal policies in the U.S., markets in the Asian region may sit tight midweek awaiting updates,” said Jingyi Pan, a market strategist at IG in Singapore. “The impact of a successfully implemented (tax overhaul) plan would be far-reaching with President Trump placing a key focus on bringing back funds from U.S. firms ’parked overseas.”’
YELLEN TALK: Federal Reserve Chair Janet Yellen said at a conference of economists that the Fed is puzzled that inflation remains so low. While she and other policymakers still think inflation will eventually reach the Fed’s two per cent target, Yellen conceded the Fed may need to change its assumptions. Yellen also said the Fed should take care not to raise rates too slowly. The comments may have changed some economists’ view on the prospects of a December rate hike but it still seems likely that the Fed will continue to lift the rate gradually higher, said Ric Spooner, chief market analyst at CMC Markets.
OIL: Benchmark U.S. crude rose 4 cents to $51.92 per barrel on the New York Mercantile Exchange. The contract slid 34 cents to finish at $51.88 a barrel on Tuesday. Brent crude, the standard for international oil prices, fell 9 cents to $57.83 a barrel in London. It gave up 51 cents to $57.92 a barrel on Tuesday.
CURRENCIES: The dollar rose to 112.89 yen from 112.23 yen. The euro fell to $1.1744 from $1.1791.