Asian share markets were mostly in the red on Wednesday as worries about waning global growth lifted safe-haven bonds, while shoving oil prices to their lowest in more than two years. Extending a three-month-long decline, Brent oil sank $1.18 to $90.93 a barrel while U.S. crude tumbled $1.07 to $87.78. The protracted slide should be a windfall for consumer spending power, but is also a powerful force for disinflation in much of the developed world.
That has been a boon for sovereign bonds as investors wager the outlook for slowing inflation could put off the day when U.S. interest rates might rise. Minutes of the Federal Reserve’s last policy meeting are due later in the session and markets will be acutely sensitive to how the debate between hawks and doves on the committee was playing out.
In Asia, Japan’s Topix shed 1.1 percent while the Nikkei dropped 1.0 percent. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1 percent, while Australia’s main index lost 0.9 percent. China’s markets bucked the trend as they returned from a week-long break, with Shanghai up 0.5 percent, though Hong Kong shed 0.7 percent.
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