Asia stocks mostly down after Syria strike

Adjust Comment Print

The world's second-largest economy expanded by 6.8 percent over a year earlier, in line with the quarter ending in December and down slightly from 2017's full-year expansion of 6.9 percent, data showed Tuesday. South Korea's Kospi dipped 0.15 percent and Hong Kong's Hang Seng was flat. Australia's S&P/ASX 200 added 0.1 percent to 5,847.50.

Asian markets fell on Monday after a US-led strike on Syrian targets fuelled fresh geopolitical concerns over the Middle East.

While Saturday's missile strikes were the biggest intervention by Western countries against Syria, investor risk appetite in the broader markets improved on speculation that the attacks would not lead to prolonged conflict.

"The markets had been bracing for a possible escalation in Syria following President Trump's earlier warnings".

"Investors were relieved that the military action didn't expand further", said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co., as the strikes were limited to Syrian chemical weapons facilities and did not escalate into a direct confrontation with Russian Federation.

"That said, the underlying picture has not changed".

"The markets are taking the surgical strike at the heart of Syria's chemical weapon programme in their stride as traders had priced in this outcome with a high degree of probability", Stephen Innes, head of Asia-Pacific trade at OANDA, said in a note. Wall Street is forecasting the strongest growth in seven years for S&P 500 companies, and the hope has been that healthy profit reports will steady the market following a rough couple of months. But the impact on financial markets in Asia was limited as it comes at a time of even harsher threats of US penalty tariffs on China and other nations.

Indonesia's Jakarta Composite index was rising 0.3 percent and the Taiwan Weighted was little changed while Singapore's Straits Times index was declining 0.2 percent.

However, Tokyo ended the morning session in positive territory, while Sydney edged up 0.4 percent.

The euro was a shade higher at $1.2383.

CURRENCY: The dollar was trading at 107.23 yen, down from 107.36 yen late Friday.

The pound touched a near three-month high of $1.4346 and in reach of a post-Brexit referendum high with focus on data that could cement expectations of a May interest rate increase by the Bank of England.

The Hong Kong Monetary Authority (HKMA) stepped into the currency market again on Tuesday, buying HK$5.77bn ($735m) in Hong Kong dollars as the local currency repeatedly hit the lower end of its allowable trading band.

Oil prices slipped with Brent crude futures LCOc1 off 66 cents at $71.92 a barrel, while USA crude CLc1 fell 56 cents to $66.83 a barrel.

Safe-haven assets eased in response, with yields on USA 10-year Treasury debt US10YT=RR up two basis points at 2.84 percent.

The big four banks also closed mixed, while energy stocks such as Woodside Petroleum, Oil Search and Origin Energy gained 1-2 percent after crude oil prices posted their largest weekly gain in nearly a year.

Aluminium hovered near seven-year highs reached the previous day after USA sanctions on Russian producer Rusal stirred supply concerns.

Comments