Asia Stocks Set for Fourth Weekly Drop on Global Growth Concern

Asian stocks headed for its worst streak of weekly losses since September as investors assess what a U.S. interest-rate increase as soon as next month will mean for global growth. Raw-material makers rebounded to lead gains on the regional benchmark index.

The MSCI Asia Pacific Index declined 0.1 percent to 125.17 as of 9:04 a.m. in Tokyo, extending this week’s slide to 0.4 percent. The gauge is on course for a fourth week of losses, the worst run since seven weeks of declines that ended in September. This week’s surge in expectations for higher U.S. rates has dealt another blow to sentiment that was already brittle amid weaker-than-estimated earnings in Japan and disappointing economic data in China.

Some Fed policy makers expressed concern that markets were ill-prepared for a rate increase next month, minutes of the central bank’s April meeting showed this week. The document also indicated policy makers’ willingness to raise interest rates in June if the economy continues to improve.

Australia’s S&P/ASX 200 Index was little changed and New Zealand’s S&P/NZX 50 Index slid 0.2 percent. South Korea’s Kospi index lost 0.1 percent.

Source: Bloomberg

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Asian Stocks Outside Japan Fall on Fed Concern While Oil Climbs

Most Asian stocks declined amid a revival in concern over the prospect of U.S. interest-rate hikes, while Japanese shares climbed after data showed Asia’s second-largest economy returned to growth. Oil extended gains into a third day.

Despite a 0.1 percent increase in Japan’s Topix index, a gauge of regional equities fell for the first time this week following a selloff in the U.S. The yen held near a three-week low versus the dollar after U.S. consumer prices increased by the most in three years and a pair of Fed officials suggested higher rates may be warranted. Crude extended gains above $ 48 a barrel, with analysts projecting a drop in American stockpiles, while nickel and zinc fell.

Global equities have struggled to extend gains since reaching a four-month high on April 20 as investors scrutinize U.S. data for clues to the timing of the Fed’s next policy move. Atlanta Fed President Dennis Lockhart and San Francisco’s John Williams said Tuesday two rate increases this year may be warranted, while Dallas Fed President Robert Kaplan said a hike may come soon, pushing odds on a June increase to 12 percent, from 4 percent on Monday. In Japan, where central bank efforts have had limited impact this year, 1.7 percent annualized growth in the first quarter meant the economy dodged a recession.

Source: Bloomberg

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