Thursday Morning Briefing: Asian Shares Fall On Fed Minutes
Asian shares fell tracking weakness in U.S. stocks overnight, after Federal Reserve minutes from March meeting signalled balance sheet reductions later this year.
The yen strengthened for the fifth day against the dollar while crude fell below $51 a barrel.
SGX Nifty futures indicate a weak start for Indian equities after the underlying NSE Nifty 50 Index ended at fresh record highs on Wednesday.
Fed Minutes Weigh
The minutes of the March meeting indicated that most Fed officials supported starting to shrink the central bank's balance sheet, which ballooned to $4.5 trillion following three rounds of bond purchases, in 2017
The minutes also showed "some participants viewed equity prices as quite high relative to standard valuation measures."
Investors are now focussed on a meeting between China's President Xi Jinping and his U.S. counterpart Donald Trump later today for any developments on U.S.-China trade ties. U.S. non-farm payrolls are due on Friday.
The S&P 500 Index erased early gains to close 0.31 percent lower, with financials leading the sell-off. The Dow Jones Industrial Average ended down 0.2 percent at 20,648.15.
Also Read: Traders Bet the Fed Will Slow Rate Hikes to Shrink Balance Sheet
Oil Below $51
Oil prices fell below $51 a barrel as rising U.S. crude output raised concerns over a global supply glut.
U.S. production rose for the seventh week and record inventories expanded further, according to an Energy Information Administration report.
Gold dropped for the second day to $1,255 per ounce after rising in the three previous sessions.
Weak Start?
SGX Nifty futures fell 0.38 percent to 9,252 as of 7:15 a.m., indicating a weak start to the Indian markets.
Indian shares closed at fresh record highs on Wednesday on the back of overseas flows. Investors are now focused on the Reserve Bank of India policy decision later today, where the central bank is expected to keep repurchase rate steady at 6.25 percent, according to a BloombergQuint poll of economists.
Shares of Phoenix Mills Ltd. will be in focus today after the real estate developer announced plans to form a strategic investment platform called Island Star Mall Developers with Canada Pension Plan Investment Board.
Also Read: India's Confused Monetary Policy And Its Committee
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