Economy

Asian stocks muted on Fed tapering outlook

BEIJING (AP) — Asian stock markets were muted Thursday amid concern an improved U.S. economy might prompt the Federal Reserve to reduce its stimulus faster than previously expected.

A survey Wednesday that showed U.S. employment increased in December prompted concern the Fed might accelerate the process of winding down bond buying that has supported stock prices. The Fed has been buying $85 billion of bonds a month in a strategy dubbed quantitative easing, or QE, but said in December it will trim that by $10 billion to $75 billion beginning this month.

"The bet is on QE wind-down sooner rather than later," said Mizuho Bank in a report. Tokyo's Nikkei 225 shed 1.6 percent to 15,868.29 while China's benchmark Shanghai Composite Index gained 0.2 percent to 2,048.41. Hong Kong's Hang Seng dropped 0.1 percent to 22,981.64.

Elsewhere in Asia, Taiwan's Taiex was down 0.4 percent and Seoul's Kospi fell 0.2 percent. Sydney's S&P/ASX 200 was little changed at 5,313.60. India's Sensex was steady. In the United States, payroll processor ADP said companies added 238,000 jobs in the U.S. in December, up slightly from 229,000 in the previous month. November's figures were also revised higher. Official jobs data are due to be released Friday.

On Wall Street, the Dow Jones industrial average shed 0.4 percent and the Standard & Poor's 500 lost 0.1 percent as investors looked ahead to the jobs numbers and the start of corporate earnings season.

In Europe, Germany's DAX lost 0.1 percent on Wednesday and Britain's FTSE index fell 0.5 percent. France's CAC-40 was flat. Eurostat, the Euoprean Union's statistics office, said retail sales in the eurozone jumped 1.4 percent in November, more than expected. But it said unemployment stuck at a record-high 12.1 percent for the eighth straight month.

In currency markets, the euro rose slightly to $1.3583 from $1.3577 late Wednesday. The dollar rose 0.1 percent to 104.91 yen. Benchmark crude for February delivery was up 25 cents to $92.58 in electronic trading on the New York Mercantile Exchange. The contract plunged $1.34 to close at $92.33 on Wednesday after government data showed U.S. demand for gasoline last week fell to its lowest level in a year

Related Headlines

  • Markets take Fed tapering in stride

    Investors around the world were largely unfazed Thursday by the surprise decision by the U.S. Federal Reserve to reduce its monetary stimulus. Most breathed a sigh of relief ... 

  • Markets depressed amid Fed tapering talk

    Speculation that the U.S. Federal Reserve will start reducing its monetary stimulus this month weighed on stock markets Tuesday. A surprisingly strong manufacturing survey ... 

  • Solid US jobs data lift markets

    Markets mostly rose Friday after another solid U.S. jobs report, and despite concerns that the Federal Reserve might pull back on its monetary stimulus earlier than expected. 

  • Yellen testimony shores up markets again

    The mood in financial markets remained optimistic Friday, a day after the main U.S. indexes struck all-time highs following a signal from the incoming Federal Reserve chief ... 

Find the best rates

Find your future job here