Asia shares, currencies tumble; oil jumps at start of 2016
Asian shares and currencies fell on Monday on the first day of trading in 2016 after China factory activity contracted and the yuan weakened, while oil prices jumped as much as 3 percent on rising tensions in the Middle East.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.7 percent, after shedding nearly 12 percent in 2015 as China’s cooling economy took a toll on its trade-reliant Asian neighbors and global commodity prices.
Japan’s Nikkei fell 2.6 percent to 2-1/2-month lows, while mainland China shares tumbled more than 4 percent.
US stock futures dipped 0.4 percent ESc1.
Adding to worries about China, its central bank fixed the yuan at a 4-1/2-year low, while manufacturing surveys showed any hopes for a recovery in that sector were premature.
“While fiscal support has helped slow the rate of economic deceleration, China needs to balance the need for stimulus with the reality of the unsustainable buildup in debt. This will continue to limit the scope for stimulus, and suggests further economic deceleration in 2016,” said BlackRock CIO Ross Koesterich in a note to clients.
The offshore yuan fell 0.5 percent to 6.6030 per dollar, edging near a five-year low touched last week. Onshore, trade, the yuan CNY=CFTC hit its lowest since April 2011.
Read full article: Money Control
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