SINGAPORE: Asian shares fell on Friday as investors balanced positions on the last day of the quarter.
The dollar rose on positive US economic growth data and the euro was flat after overnight losses on figures suggesting slowing expansion in Europe.
European shares were headed for a muted start, with financial spreadbetters expecting Britain’s FTSE 100 to open 0.3 per cent lower, France’s CAC 40 to start the day down 0.1 per cent and Germany’s DAX to be little changed.
MSCI’s broadest index of Asia-Pacific shares outside Japan retreated 0.55 per cent. The benchmark is up 12.5 per cent for the quarter.
Hong Kong shares fell 0.6 per cent, but were still headed for a 9.8 per cent quarterly jump.
“Asia saw some pretty healthy profit-taking after a few sessions of solid gains, and as investors await Euro zone and US inflation data tonight,” said James Woods, global investment analyst at Rivkin Securities in Sydney.
China’s CSI 300 index bucked to trend to add 0.4 per cent, putting it on track for a 4.2 per cent quarterly rise.
Activity in China’s manufacturing sector expanded at the fastest pace in nearly 5 years in March, beating expectations, an official survey showed on Friday.
The data came as US President Donald Trump foreshadowed a tense meeting with Chinese President Xi Jinping next week by tweeting on Thursday that the US could no longer tolerate massive trade deficits and job losses.
Trump will also sign executive orders on Friday aimed at identifying abuses that are causing the deficits and clamping down on non-payment of anti-dumping and anti-subsidy duties on imports, his top trade officials said.
Chinese Vice Foreign Minister Zheng Zeguang said on Friday that China does not have a policy to devalue its currency to promote exports, and neither does it seek a trade surplus with the United States.
US stock futures were down between 0.2 and 0.3 per cent in Asian trade.
Japan’s Nikkei reversed gains to close down 0.8 per cent as markets digested data that showed Japanese core consumer prices rose 0.2 per cent in February. While that is the fastest annual pace in nearly two years, household spending and consumer inflation remained subdued when the effect of rising energy costs was stripped out.
The Japanese benchmark was down 1.1 per cent for the first quarter.
The South African rand dropped to a two-month low after President Jacob Zuma sacked and replaced both the finance and deputy finance ministers in a cabinet reshuffle after days of speculation that has rocked the country’s markets and currency.
The weakened rand saw the dollar up 1.7 per cent at 13.5098 rand, on track to end the week almost 9 per cent higher.
Overnight, all three major Wall Street indexes closed about 0.3 per cent higher after fourth-quarter annualised growth in US gross domestic product was revised up from the previously reported figure.
The upbeat data also helped lift the dollar.
The dollar index, which tracks the greenback against a basket of six peers, rose 0.1 per cent to 100.54, after hitting a two-week high on Thursday. Despite this week’s gains — it is up almost 1.7 per cent since Monday’s four-month low — the greenback is set to end the quarter 1.6 per cent lower.
The dollar was steady at 111.885 yen after Thursday’s 0.9 per cent jump, but is heading for a 4.2 per cent quarterly decline.
Nervousness could return to US markets on news Trump’s former national security adviser, Michael Flynn, has offered to testify before congressional committees probing possible ties between the Trump campaign and Russia, his lawyer said on Thursday.
The euro was flat at $1.0676 after Thursday’s 0.8 per cent tumble. The common currency is on track to post a gain of 0.9 per cent for March and 1.45 per cent for the quarter.
Data showed German and Spanish consumer inflation slowed more than expected in March, disappointing investors who were hoping for a wind-down of the European Central Bank’s monetary stimulus.
In commodities, US crude slipped 0.5 per cent to $50.09 a barrel. On Thursday, it closed 1.7 per cent higher after zipping to a three-week-high earlier in the session after Kuwait backed an extension of Opec production cuts.
It is heading for a 6.7 per cent loss for the quarter.
Global benchmark Brent slid 0.7 per cent to $52.64 a barrel and is on track for a 7.4 per cent decline for the quarter.
Gold pulled back 0.1 per cent to $1,241.81 an ounce, extending Thursday’s 0.7 per cent loss on the dollar’s strength, but remains set for a 7.85 per cent quarterly gain. — Reuters
Oman Observer is now on the WhatsApp channel. Click here
