Asian stocks slip amid China, sovereign debt jitters
Tuesday, 16 March 2010
singapore, Mar 15 (Reuters): Asian stocks fell from near seven-week highs Monday as a currency spat between China and the United States and worries about sovereign debt combined to keep investors away from riskier assets.
Markets were also cautious before US and Japanese central bank meetings later this week. Both are expected to keep monetary policies super loose, with a chance of even further easing in Japan, which has kept the yen on the defensive.
The wary mood looked set to carry over into European trade, where investors grappled with more on-again, off-again media reports of European help for debt-laden Greece.
Financial spreadbetters expected Britain's FTSE 100, Germany's DAX and France's CAC-40 to open as much as 12 points lower.
"The market moves seen today can be best described as jittery," analysts at Westpac said in a note.
"China's Premier Wen Jiabao weekend comments on the yuan and economy left traders in little doubt that the current 'dirty peg' wasn't going anywhere fast - at least not today."
Wen said Sunday the yuan was not undervalued, and rejected international calls to allow the currency to rise. He also said there was a chance the world economy may suffer a double-dip recession as conditions in some countries remain weak.
A report from credit agency Moody's Monday about ballooning government debt further backed the case for investors to play it safe.
Markets were also cautious before US and Japanese central bank meetings later this week. Both are expected to keep monetary policies super loose, with a chance of even further easing in Japan, which has kept the yen on the defensive.
The wary mood looked set to carry over into European trade, where investors grappled with more on-again, off-again media reports of European help for debt-laden Greece.
Financial spreadbetters expected Britain's FTSE 100, Germany's DAX and France's CAC-40 to open as much as 12 points lower.
"The market moves seen today can be best described as jittery," analysts at Westpac said in a note.
"China's Premier Wen Jiabao weekend comments on the yuan and economy left traders in little doubt that the current 'dirty peg' wasn't going anywhere fast - at least not today."
Wen said Sunday the yuan was not undervalued, and rejected international calls to allow the currency to rise. He also said there was a chance the world economy may suffer a double-dip recession as conditions in some countries remain weak.
A report from credit agency Moody's Monday about ballooning government debt further backed the case for investors to play it safe.