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GLOBAL MARKETS-Asian stocks open lower as faith in global recovery slips

Published 2020-09-23, 08:20 p/m
Updated 2020-09-23, 08:24 p/m
© Reuters.

By Imani Moise

NEW YORK, Sept 23 (Reuters) - Asian stocks opened lower on Thursday, tracking a sharply lower Wall Street session amid fresh concerns that the global economic recovery is running out of steam.

U.S. stocks fell on Wednesday after data showed business activity slowed in September, with gains at factories more than offset by a retreat at services industries. now await weekly data due later on Thursday, which is expected to show U.S. jobless claims fell slightly but remained elevated, indicating the world's largest economy is still far from recovering.

The data comes after a Federal Reserve official said it will be hard to boost employment without further government stimulus. with congress locked in a stalemate, analysts see immediate fiscal support as unlikely.

"Equity sentiment remained positive in Europe but quickly soured in the U.S. as Fed speakers urged further fiscal support for the economy," Westpac Institutional Bank analysts said in a note.

In Asia, E-mini futures for the S&P 500 EScv1 fell 0.11%, Australia's S&P/ASX 200 .AXJO lost 1.6% and Japan's Nikkei 225 .N225 declined 0.56%. Hong Kong's Hang Seng index futures .HSI HSIc1 dropped 0.92%.

Additionally, a second wave of coronavirus infections in Europe threatened the economic recovery in that region pushing equities lower and propping up the safe-haven the safe haven dollar.

On Wednesday, the Dow Jones Industrial Average .DJI fell 1.92%, the S&P 500 .SPX lost 2.37% and the Nasdaq Composite .IXIC dropped 3.02%.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.04% higher, while Japan's Nikkei .N225 %.

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Strength in the dollar, which rallied to a two-month high on Wednesday, weighed on gold prices.

The dollar index =USD rose 0.393%, while spot gold XAU= dropped 0.3% to a two-month low at $1,858.39 an ounce.

Oil prices advanced slightly after reports that inventories were down across the U.S. but gains were muted by uncertainty about demand going forward as travel remains limited due to the pandemic.

Brent crude LCOc1 rose 5 cents to settle at $41.77 a barrel. U.S. West Texas Intermediate crude CLc1 gained 13 cents to settle at $39.93 a barrel.

The yield on Treasuries Benchmark 10-year US10YT=RR rose 1.3 basis points to 0.677% on Wednesday while the 30-year bond yield US30YT=RR rose 1.2 basis points to 1.427%.

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