Asian shares mostly lower after China stabilizes currency
TOKYO (AP) — Asian shares were mostly lower Wednesday as markets calmed after China’s decision to stabilize its currency.
Japan’s benchmark Nikkei 225 dipped 0.8% to 20,421.93. Australia’s S&P/ASX 200 added 0.3% to 6,497.60 in morning trading. South Korea’ Kospi slipped 0.2% to 1,913.43. Hong Kong’s Hang Seng dipped 0.8% to 25,758.83, while the Shanghai Composite was little changed, inching down less than 0.1% to 2,776.91.
Wall Street regained its footing a day after its biggest decline in a year, which had been set off by news that China allowed its currency to depreciate against the dollar to its lowest level in 11 years.
The S&P 500 index rose 37.03 points, or 1.3%, to 2,881.77. The index dropped 3% on Monday, its worst loss since December. The Dow climbed 311.78 points, or 1.2%, to 26,029.52. The Nasdaq composite gained 107.23 points, or 1.4%, to 7,833.27. The Russell 2000 index of smaller companies picked up 14.67 points, or 1%, to 1,502.09.
Global investors have grown nervous lately about the possible impact that a trade war between the U.S. and China could have on the economy and corporate profits.
But China’s decision to allow its currency to stabilize Tuesday suggests Beijing might hold off from aggressively allowing the yuan to weaken as a way to respond to U.S. tariffs on Chinese goods.
“Markets have gone full circle again hoping for the best while preparing for the worst where even the tiniest gestures could see investors could respond more positively than warranted given how emotionally invested market participants are,” said Stephen Innes, managing partner at VM Markets in Singapore.
Benchmark crude oil lost 12 cents to $53.51 a barrel. It fell $1.06 to $53.63 a barrel on Tuesday. Brent crude oil, the international standard, fell 5 cents to close at $58.89 a barrel.
The dollar rose to 106.10 Japanese yen from 106.40 yen on Tuesday. The euro rose slightly to $1.1211 from $1.1199.
AP Business Writers Alex Veiga and Damian J. Troise contributed to this report.