· Asia stocks snap winning streak, bonds rally on downbeat Fed
Asian shares retreated on Thursday as a gloomy outlook from the U.S. Federal Reserve challenged market optimism on the global economy, while bonds rallied on speculation that yet more stimulus would be needed to ensure recovery.
After a slow start, MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 1.4%, likely putting an end to a 10-session winning streak.
· Japan shares see biggest daily drop in 6 weeks as yen firms on Fed view
Japanese shares suffered their biggest one-day fall in six weeks on Thursday as the safe-haven yen strengthened after the U.S. Federal Reserve’s dour economic outlook spooked investors.
The benchmark Nikkei average plunged 2.8% to 22,472.91, its largest daily decline since May 1, moving further away from a 3-1/2-month closing high hit earlier in the week.
The broader Topix lost 2.2% to 1,588.92, also posting its biggest one-day drop, with all but one of the 33 sector sub-indexes on the Tokyo exchange finishing lower.
· China stocks end lower on profit-taking, economic woes
China stocks erased early gains and ended lower on Thursday, reflecting lingering concerns over the economy as some investors took profit after a strong rebound recently.
The blue-chip CSI300 index fell 1.1%, to close at 3,995.88, while the Shanghai Composite Index lost 0.8% to 2,920.90.
Investors are closely monitoring economic data to gauge health of the economy. New bank lending in China fell more than expected in May but broader credit growth quickened as the central bank continues to ease policy to get the economy back on solid footing after the coronavirus crisis.
· European markets plunge after Fed outlook; Stoxx600 down 2.4%
European stocks fell sharply Thursday as investors digest the latest comments from the U.S. Federal Reserve.
The pan-European Stoxx600 dropped 2.4% at the start of trading, with travel stocks plunging 5% as all sectors and major bourses tumbled into negative territory.
Investor reaction to the Fed’s latest economic forecast will be in the spotlight Thursday. The U.S. central bank kept interest rates unchanged on Wednesday and indicated it does not expect to raise them through 2022.The Fed also said it expects the U.S. economy to contract by 6.5% in 2020 before expanding by 5% in 2021.
Reference: CNBC, Reuters
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