Asia stocks fall as investors brace for weak US growth data
HONG KONG (AP) — Asian stocks sank Wednesday as investors braced for a U.S. growth report and Fed policy statement that are expected to provide the latest signs of slowing momentum in the world’s biggest economy.
KEEPING SCORE: Hong Kong’s benchmark Hang Seng index lost 0.6 percent to 28,265.71 and South Korea’s Kospi fell 0.8 percent to 2,130.09. The Shanghai Composite Index in mainland China shed 0.5 percent to 4,454.11 and Australia’s S&P ASX/200 sank 1.3 percent to 5,872.50. Japan’s stock market was closed for a holiday.
US ECONOMY: Investors are pulling back as signs mount that growth in the world’s biggest economy is slowing. A Conference Board report on Tuesday showed that consumer confidence unexpectedly fell to its lowest in four months, knocked by a slowdown in hiring. Further bad news is expected when an initial estimate of first quarter growth is released later Wednesday. Economists are expecting quarterly growth of 1 percent, down from 2.2 percent in the previous period, because of severe winter weather and a stronger dollar that’s hurting American manufacturers.
FED STATEMENT: Hours after the U.S. economic data is released, the Federal Reserve is set to issue a policy statement after the end of its two-day meeting. Investors will be looking for any hints on when it will raise interest rates but expectations now are that they’ll stay at record lows until at least September.
ANALYST VIEW: “The market has set the bar very low for tonight’s Federal Open Market Committee statement. Traders are expecting the Fed to come across more temperate on its economic outlook after the recent batch of soft U.S. economic data,” Stephen Innes, senior trader at OANDA Asia Pacific, said in a commentary.
WALL STREET: Major U.S. benchmarks were lackluster as investors digested a big batch of corporate earnings reports. The Dow Jones industrial average rose 0.4 percent to 18,110.14 while the Standard & Poor’s 500 rose 0.3 percent to 2,114.76. The Nasdaq composite edged down 0.1 percent to 5,055.42.
CURRENCIES: The dollar rose to 118.88 yen from 118.82 yen in the previous session. The euro fell to $1.0967 from $1.0972.
ENERGY: U.S. benchmark crude dipped 21 cents to $56.85 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 7 cents to close at $57.06 a barrel on Monday. Brent crude fell 20 cents at $64.44 a barrel in London.