On Thursday, Asian stocks mostly fell as fresh data signaled a further loss of momentum in the economy of China that weighed on sentiment.
The Japanese Yen slid to multi-year lows against the dollar and euro. The Yen was striking seven-year lows against the dollar and a six-year trough versus the euro due to tides of super-cheap liquidity from the Bank of Japan.
The China flash HSBC/Markit manufacturing purchasing managers’ index published revealed factory output contracted in China for the first time in six months.
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dropped 0.3 percent to briefly touch a three-week low. Hong Kong’s Hang Seng .HSI was down 0.1 percent and the Shanghai Composite Index .SSEC lost 0.3 percent. Australian shares .AXJO shed 0.4 percent to give up this year’s gains.
The U.S. currency rose 1 percent overnight after the minutes of the last policy meeting of the Federal Reserve disclosed its members were relatively unconcerned about the dollar’s strength. “The market doesn’t really know how to react to this, whether it’s a hawkish or dovish statement, but the reality is I think it’s a truthful statement that we are in a very interesting spot with both headwinds and tailwinds facing this economy,” said Burt White, chief investment officer at LPL Financial in Boston.
“The Fed has left the green light shining brightly for further USD gains,” said Alan Ruskin, global head of currency strategy at Deutsche. “The USD/JPY take-profit zone still looks some way off — a little ahead of the major 120 yen level.”
The Australian dollar was down 0.3 percent to $0.8590 AUD. U.S. crude CLc1 was down 9 cents at $74.49 a barrel.