Asian markets drifted lower Wednesday as weak dollar has hit exporters, and stocks of raw materials gained on a jump in oil prices and gold.
The U.S. dollar was floating near the minimum for the year against the euro and two months against the yen Tuesday after the sinking, while oil prices were above $ 71 after jumping more than $ 3 a barrel during the night. Gold kept its nose above $ 1000 an ounce after rising above that mark the previous day for the first time since February.
Following a series of gains triggered by announcements of great concentration and the Group of 20 is the commitment to maintain the commitment of stimulus, investors were once again cast doubt on the strength of recovery from the global downturn.
"The market has grown too much in recent days. The time now is very weak. In the coming days, the downside risk is very high and the upside risk to be low," said Peter Lai, investment manager at DBS Vickers in Hong Kong.
The weakness of the dollar could continue to push the price of gold, says Lai, because it makes the precious metal more affordable in other currencies. Gold is often seen as a safe investment haven and hedge against inflation.
The cut in U.S. dollars ¥ 92.32 from ¥ 92.26 late Tuesday, while the euro rose to $ 1.4500 from $ 1.4488.
Motor and other exporters in Japan and South Korea was hit amid concerns that the weak dollar, which erodes their earnings abroad. The Nikkei 225 stock average was down 115.37 points, or 1.1 percent, to 10,277.86, while the Kospi in South Korea retreated 0.7 percent to 1,608.33.
Toyota Motor Corp., the world’s largest manufacturer, declined by 2.3 percent and electronics giant Sony fell 2.8 percent. Hyundai Motor Co. shed 4.9 percent in Seoul.
In Hong Kong the Hang Seng fell 199.47, or 1 percent, to 20,870.34, taking its cue from the Chinese market in Shanghai, where the benchmark index fell 0.4 percent to 2,918.68.
Australia’s main index slipped 0.2 percent in retail trade news weakened during the month of July.
Miners and producers of other raw materials has a lift from oil prices and gold. Gold miner Newcrest Mining gained 1.6 percent in Sydney and Thai energy conglomerate PTT PCL jumped 1.6 percent in Bangkok.
After a long week-end, the Dow Jones rose 56.07, or 0.6 percent, to 9,497.34 on Tuesday. The broader Standard & Poor’s 500 rose 8.99, or 0.9 percent, to 1,025.39 and the Nasdaq Composite index rose 18.99, or 0.9 percent, to 2,037.77.
Stock futures pointed to losses on Wall Street Wednesday. Dow futures fell 36, or 0.4 percent, to 9460 and S & P futures rose 4, or 0.4 percent, to 1021.10.
Benchmark crude for October delivery was 25 cents to $ 71.35 per barrel at midday in Singapore on time electronic exchange in the New York Mercantile Exchange. Tuesday, the contract gained $ 3.08 to settle at $ 71.10, driven by increased weakening of the dollar.
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