Asian stocks drop, Nikkei nears 50-DMA support
|Asian stocks pulled back from a 19-month high, with Japan’s Nikkei nearing 50-DMA support of 19,228 levels despite Fed minutes indicating cautious approach to policy tightening.
Nikkei hit a low of 19,262 levels and was last seen trading around 19,336; down 0.22% on the day. Stocks in Australia retreated 0.3%. Wall Street continued its record run on Wednesday, with Dow closing 0.2% higher; its ninth straight record daily close.
Overnight strength in the Japanese Yen weighed over the exporter shares in Japan. Moreover, the US dollar was offered across the board as the Fed minutes carried the usual ambiguous language with regards to the timing of the next Fed rate hike.
Moreover, the Fed remains market-dependent and unless markets don’t boost rate hike bets at least above 60%, the Fed would not want to raise rates.
However, what that tells us is that nothing really has changed despite the Trump Bump and rising inflation expectations.
The Dollar index dropped from the high of 101.72 to 101.16 on Wednesday before staging a minor recovery to 101.35 levels in Asia.
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