FTG Blog - Asia Stocks Fall While Oil Extends Gain, Yen Slips: Markets Wrap

Asian Stocks Fall While Oil Extends Gain, Yen Slips: Markets Wrap

Asian stocks fell as investors approached the end of the quarter with the Trump administration attempting to move ahead with its legislative agenda while Federal Reserve officials consider the frequency of interest-rate increases. The yen weakened and crude extended Wednesday’s surge.

The Shanghai Composite Index headed for the biggest decline since December, while equities in Japan, South Korea and Singapore also fell. Australian shares rose as energy producers rallied. Crude approached $50 a barrel as oil stockpiles increased less than forecast. Treasuries dropped after Wednesday’s advance, while gold slipped.

Gains in riskier assets have pushed the value of global stocks to $71 trillion, with shares heading toward a fifth month of gains, as the reflation trade triggered by Trump’s election shows resilience. Stronger global growth has helped underpin the rally, even amid doubts about the U.S. president’s ability to enact pro-growth policies.

U.S. House Republicans are considering making another run next week at passing the health-care bill they abruptly pulled from the floor. The renewed discussion comes after President Donald Trump and Republican leaders in Congress said they would move on to issues like a tax overhaul.

Meanwhile, Fed officials continued to offer views on the potential path for interest-rate hikes. Fed Bank of Boston President Eric Rosengren said the central bank should be prepared to raise rates a total of four times in 2017 to guard against overheating the U.S. economy.

Investors are also weighing the impact after the U.K.’s formal triggering of Brexit Wednesday. While the move had been broadly telegraphed, the divorce will redefine the country’s relationship with its largest trading partner and end decades of deepening political integration on the continent.