Asian shares down ahead of Comey, ECB and UK election

Ivan Schwartz
June 9, 2017

ASIAN SCORECARD: Japan's benchmark Nikkei 225 index lost 0.3 percent to close at 19,909.26 and South Korea's Kospi edged up 0.2 percent to 2,363.57.

Japan released revised first-quarter data that showed Asia's second-largest economy expanded an annualized 1 percent, a significant drop from last month's initial 2.2 percent estimate, according to Kyodo News. Australia's S&P/ASX 200 crept up 0.2 percent to 5,676.60. But recent polls suggested a narrowing lead for May, with some pointing to the chance that the Tories may not win an outright majority, capping the pound's gains.Oil prices licked wounds after sharp falls on Wednesday to a one-month low, following an unexpected increase in USA inventories of crude and gasoline that fanned fears that output cuts by major world oil producers have not done much to drain a global glut.Brent crude futures LCOc1 traded at $48.36 per barrel, up 0.6 percent so far on Thursday, though they had fallen 4.1 percent the previous day. Meanwhile, China trade growth accelerated last month, with exports expanding 8.7 percent and imports up 11.9 percent, pointing to a pickup in global demand.

Sterling GBP=D4 held firm at $1.2957, near its highest levels in two weeks, as all eyes were on the United Kingdom general election.The pound gained as much as 4 percent after Prime Minister Theresa May called a snap election seven weeks ago, as polls had initially suggested a landslide win for her Conservative party that would give the prime minister a stronger hand in Britain's negotiations on leaving the European Union. The race looks to be tighter than expected as the Conservatives' lead over Labour narrowed sharply in recent weeks.

The ECB meeting is one of three events that ING currency strategist Viraj Patel said had been dubbed 'Triple Threat Thursday, ' an event-filled day that could send global markets on a bumpy ride. The ECB is widely expected to keep its policy unchanged on Thursday, including its 2.3 trillion euro bond buying programme and pledge to keep rates low.

QUOTEWORTHY: "Asian markets are still expected to idle in this trend of mixed performances ahead of the key events", said Jingyi Pan, market strategist at IG.

In a written statement posted on the web on Wednesday, Comey, the former Federal Bureau of Investigation chief fired by President Donald Trump, said Trump asked him to back off from a probe into former national security advisor Michael Flynn and told Comey, "I need loyalty".

"Currency markets are watching the United Kingdom election, the ECB meeting tomorrow and then casting eyes forward to the Federal Reserve meeting next week", said Bill Northey, chief investment officer at the private client group of U.S. Bank in Helena, Montana.

UK Elections: Exit polls forecast hung parliament
The Labour Party drew strong support from young people, who appeared to have turned out to vote in bigger-than-expected numbers. Among the casualties was Alex Salmond, a former first minister of Scotland and one of the party's highest-profile lawmakers.

Ex-UK Chancellor of Exchequer: Vote Result 'Completely Catastrophic' for PM May
At 1am, punters now think there is a 72% probability that Theresa May , the prime minister, will lose her majority. But the prospect of a hung parliament , where no party has an overall majority, has raised further uncertainty.

Apple announces updated iMac models with new processors, brighter display
Even though the Siri Speaker is a nice device, I would say that it wasn't the biggest announcement of Apple on Monday. But today, Apple wrapped up the WWDC 2017 keynote with a flurry of hardware reveals as well.

WALL STREET: Major U.S. benchmarks eked out small gains.

The pan-European FTSEurofirst 300 index lost 0.08 percent and MSCI's gauge of stocks across the globe shed 0.04 percent.

The pound gained 0.4 percent on Wednesday, with investors increasingly taking the view that May's party will win a majority in the election on Thursday.

The dollar index.DXY, which tracks the greenback against six major rivals, was up 0.06 percent at 96.698.

USA light crude was last down 4.7 percent to $45.94 per barrel, with Brent 3.75 percent lower at $48.24. Brent crude, used to price worldwide oils, rose 27 cents to $48.33 per barrel in London. Brent crude, used to price global oils, rose 41 cents to $48.47 per barrel in London. The euro strengthened to 1.266 from $1.1262.

CURRENCIES: The dollar slipped to 109.80 yen from 109.83 in late trade Wednesday.

Other reports by GizPress

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