Asian stocks decline as the dollar and yuan weaken: markets wrap

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The (Bloomberg) Shares in Asia fell in line with those in the US, and a dollar rally hit a wall as the dollar dropped versus the majority of other major currencies. Bond yields decreased as well.

Stocks fell throughout the region as trading in Hong Kong was suspended due to bad weather. After the country’s economy expanded at a slower rate than anticipated, Japanese stocks plummeted for a second day. Overall, US Stocks equities futures were negative.

On Thursday, the S&P 500 dipped 0.3% as a result of the 2.9% decline in Apple Inc. shares that followed worries about iPhone sales in China. By 0.7%, the Nasdaq 100 fell. Asia-based suppliers to Apple also decreased.

In terms of currencies, the dollar dipped slightly but was still on track for its longest streak of weekly gains in years amid expectations that the Federal Reserve will maintain high interest rates.

The offshore yuan declined and is getting close to its all-time low. In a sign that officials will permit the currency to gradually depreciate, the official daily reference rate for the currency was lower.

The Japanese currency, meanwhile, momentarily gained strength after Finance Minister Shunichi Suzuki stated that Japan will closely monitor foreign exchange movements and won’t rule out any alternatives to handle excessive moves.

The head of China macro strategy for Standard Chartered Bank HK Ltd, Becky Liu, stated on Bloomberg Television that while economic development is still crucial, GDP growth levels of above or below 5% are not that significant for this administration.

For them, influencing China to adopt a new, sustainable, and independent growth model is of utmost importance.

The cost of gas increased when Chevron Corp. said that employees at some of its most important Australian facilities would start partial strikes on Friday due to the failure of negotiations with corporate management.

China intends to extend a prohibition on the use of iPhones in critical departments to state-owned businesses and government-backed organizations, a warning of rising difficulties for Apple in its biggest foreign Stocks market and center of worldwide production.

According to those with knowledge of the situation, Beijing plans to apply that limitation far more generally to a wide range of state-owned businesses and other government-controlled entities.

According to Edward Moya, senior market analyst for the Americas at Oanda, “Apple’s growth story is primarily dependent on China, and if the Beijing crackdown worsens, that might pose a significant challenge to the bunch of other megacap tech companies that depend on China.”

Others predict a minimal effect on Apple. Government officials were reportedly already avoiding the company’s products, according to Amit Daryanani of Evercore ISI. A sweeping crackdown on the company, where the bulk of iPhones are made, would have an impact on jobs, he claimed.

Meanwhile, a discussion regarding the effectiveness of US sanctions has been sparked by the discovery of a sophisticated chip in a new Huawei Technologies Co. phone.

The most recent US economic data also caught the attention of traders, with strong unemployment claims statistics supporting the Fed’s decision to maintain high interest rates. The number of US unemployment compensation applications decreased to its lowest point since February.

Two-year US rates dropped below 5% and continued to trade lower Stocks in Asia after rising immediately following the release. Lower returns were also available on government debt in Australia and New Zealand.

President of the Federal Reserve Bank of New York John Williams stated that although US monetary policy is “in a good place,” officials would need to go through data to determine how to continue with regard to interest rates. In New York, he participated in a debate that was conducted by Bloomberg’s Michael McKee.

Also on Thursday, Austan Goolsbee, the president of the Chicago Fed, said on the radio program Marketplace: We’re getting very close to the point where we won’t be debating how high the rates should go.

Mike Loewengart from the Morgan Stanley Global Investment Office remarked, “We’ve seen this movie before. “Sure, the economy has slowed down and inflation has decreased, but employment remains a problem for the Fed, which has made easing the labor market the cornerstone of its fight against inflation.

The Fed may be prepared to hold interest rates steady later this month, but they’re far from abandoning their higher-for-longer attitude.

After a nine-session surge that put oil futures in overbought territory, there was a second day of falls on Friday. The benchmark for US petroleum West Texas Intermediate is up over 1% for the week and reached its highest level since November on Wednesday, rising briefly above $88 per barrel.

Important occasions this week: