Fed Minutes Trigger Mixed Reaction In Global Equity Markets

Trading in global shares was largely mixed Thursday after the overnight release of minutes for the July meeting of the Federal Reserve. The minutes offered few signals that the Fed might raise interest rates in the near-term. Asian stocks were mixed, while European shares were seen gaining.

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The dollar dipped amid a decline in expectations of a September rate hike. But rising currencies in Asia put pressure on the region’s stocks due to limited foreign interest.

“The main mover [of markets] is the dollar falling,” noted Tareck Horchani of Saxo Capital Markets.

But as for gaining stocks, easy money appears to be driving the trades.

“[Investors] are still trading on the expectation that liquidity will be abundant and quality assets will be supported,” observed Alex Wong Ample Capital Ltd.

How Asian markets performed

Japan’s Nikkei 225 (INDEXNIKKEI:NI225) eased 1.55%, dragged down by falling stocks in the country’s Power, Shipbuilding and Transportation Equipment sectors.

A stronger yen also put pressure on Tokyo shares due to limited foreign appetite for the stocks. USDJPY rose 0.44% to 99.84, while EURJPY declined 0.23% to 112.95.

In Taiwan, the Taiwan Weighted rose 0.05%, supported by rising stocks in the country’s Cement, Iron & Still and Other sectors.

In South Korea, the KOSPI edged up 0.57%.

What about China?

The Shanghai Composite pulled back 0.17%, while the HANG SENG INDEX (INDEXHANGSENG:HSI) in Hong Kong rose 0.98%. The approval of the Shenzhen-Hong Kong trading link appeared to be lifting Hong Kong stocks. The trading link, which is expected to open up more space for equity trading in China, is expected to launch in December.

Stronger Aussie rattles Australian stocks

Stocks in Australia closed lower, with the S&P/ASX 200 declining 0.52%. The index was dragged down by falling stocks in Financials, Healthcare and Utilities sectors.

The AUDUSD rose 0.71% and AUDJPY edged up -.29%.

What happened in Europe?

Stocks in Europe opened higher on Thursday. The Euro Stoxx 50 was seen rising 0.27%, Germany’s DAX 30 gaining 0.49% and France’s CAC 40 adding 0.32% in morning trade.

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