global equity bear market deepened in Asian trading, with Japanese
stocks headed for their worst week since 2008 as anxiety over the
world economy and central banks' ability to stem trading volatility
fueled a rally in the yen. Oil rebounded from a 12-year low.
Topix index returned from holiday to a 3.9 per cent slump in
Tokyo, pushing the regional Asian benchmark toward its steepest
weekly drop since gyrations in Chinese assets rocked financial
markets at the start of the year.
futures signalled gains after losses there helped the MSCI
All-Country Index cap a 20 per cent slide from its May record.
yen was set for its best week in more than seven years, as gold
traded close to a one-year high. US crude snapped a six-day
tumble, rising from a 12-year low to trim what will still be a second
straight weekly decline. Sovereign bonds solidified gains.
entered a different phase in the market," Juichi Wako, a senior
strategist at Nomura Holdings in Tokyo, said by phone.
not simply in a risk-off mode, the market's fallen to the point of
pricing in a recession in the US. The market is saying we're worried
no matter what Yellen says and their reaction shows there can be no
real relief until we can truly see what's happening in the
ignored a second day of testimony from US Federal Reserve chair Janet
Yellen, whose indication this week that the Fed won't rush to raise
benchmark interest rates in the face of global fluctuations failed to
stem a selloff in risk assets from bank shares to crude oil and
a move to negative rates largely failed to assuage anxieties last
month, Japan stepped up its response, with Finance Minister Taro Aso
saying regulators will respond to market volatility if necessary.
Sweden's Riksbankcut rates further below zero Thursday, as central
bankers struggle to address the turmoil that has held global
financial markets in its grip since the start of the year.
Topix was poised to extend its lowest close since October 2014 as of
9.57am Tokyo time, headed for an 11 per cent slump this week.
Those losses drove MSCI's Asia Pacific Index down 1.8 per cent, on
track for a weekly decline of 5 per cent. While Japan resumed trading
after a break Thursday, markets in mainland China, Taiwan and Vietnam
remain closed for Lunar New Year holidays.
Kospi index in Seoul slipped 0.6 per cent in its second day of
trading this week, while Australia's S&P/ASX 200 Indexsank 0.8
per cent, headed for a drop in the week of 3.9 per cent. The S&P/NZX
50 Index fell 1.2 per cent in Wellington, set for its lowest close
Hong Kong, where markets resumed on Thursday after a three-day
holiday, Hang Seng Index futures foreshadowed losses of at least 1.4
per cent on the Hang Seng and Hang Seng China Enterprises indexes.
Shares in the city capped their worst start to a Lunar New Year since
1994 last session.
on the Standard & Poor's 500 Index rallied 0.3 per cent as those
on the Nasdaq 100 Index gained 0.2 per cent.
Nasdaq 100 reversed a loss of 1.6 per cent Thursday, while the
S&P 500 reduced a slump of as much as 2.3 per cent to close down
1.2 per cent in afternoon trade.
pared its decline at the same time, with the Wall Street Journal
reporting OPEC members may consider cooperating to curb output. Oil
rose briefly above $US27 in electronic trading after settling at
$US26.21, its lowest closing level since May 2003.
bank policies and the uncertainty around their effectiveness is the
big macro concern right now," said Leo Grohowski, who helps
manage more than $US184 billion in client assets as chief investment
officer of BNY Mellon Wealth Management in New York.
a large disconnect right now between what the Fed might do and what
they're saying and what the market is expecting. There's a lot of Fed
uncertainty back on the table reminiscent of late last summer."