Asian Stocks Stable But Commodities and China Going Concerns

Most Asian stock markets steadied on Wednesday after sliding to 3-year lows but a weak outlook for commodities and persistent concerns about China’s economy discouraged most buyers.

MSCI’s broadest index of Asia-Pacific shares outside Japan was little changed in early trade after plumbing its lowest since June 2012 on Tuesday on fears that China’s slowdown would curb its huge appetite for commodities and resources.

The index was on track for a 19 percent loss for the quarter, its worst loss in four years.

“Global equities are closing in on their worst quarter since 2011, with a number of factors fuelling fears in an already jittery market, including weak global growth, driven by deceleration in emerging markets, particularly China,” strategists at Barclays wrote.

“We recommend overweight positions in Japanese and European equities.”

South Korea’s Kospi dropped 1 percent while Australian shares gained 0.3 percent.

Japan’s Nikkei brushed aside an unexpected drop in the country’s industrial output and gained 1.6 percent. It was still poised for a 14 percent drop over the quarter, its deepest since 2010.

Via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza