MSCI’s broadest index of Asia Pacific shares outside Japan edged down around 0.2 percent, mirroring similar declines on Wall Street .
Japan’s Nikkei share average bucked the trend, rising 0.7 per cent as the yen weakened against the dollar, which should help Japanese exporters.
“The positive impact of a weaker yen should outweigh the disappointment about the US’s economic outlook and the lack of more powerful stimulus,” said Masayuki Doshida, senior market analyst at Rakuten Securities. “But there won’t be a sustained rally on the back of this.”
The Fed also slashed its forecast for US economic growth, hitting commodities sensitive to expectations for industrial demand.
Copper fell 1.1 per cent to around $7,465 a tonne and oil also lost ground. US crude dropped 1 per cent to $80.64 a barrel and Brent crude was down 0.6 per cent at $92.11, its lowest in 18 months.
A Reuters poll showed Wall Street’s top bond firms still see a 50 per cent chance of a third bout of quantitative easing or “QE3”, under which the Fed effectively creates money to fund large asset purchases, to stimulate the economy.
The decision to hold off on QE3 for now boosted the dollar against the euro and the yen and also hit gold, which had been rising as investors betting on QE3 had bought the precious metal as a hedge against currency depreciation.
The euro was down 0.3 per cent around $1.2665 on Thursday, while gold fell 0.2 per cent to just above $1,600 an ounce.
(curtsey: economic times)
Website : www.marketcalls.net
Facebook : www.facebook.com/marketcalls.net
Twitter : @marketcallsnet
Yahoo Messenger : firstname.lastname@example.org
Email : email@example.com
Contact : 09429518070 (Ask if you have any query)