Asian markets edged lower on a very thin trading day that witnessed risk appetite coming to a stall on weak overnight cues and weight of profit selling as investors cashed in some gains after the sharp up move in the last few days. Most of the markets in region, including China, Japan, Hong Kong, South Korea and Taiwan were closed for a public holiday, making it an uninteresting sort of a session altogether.
In the US, stocks drifted lower yesterday, as the participants continued to stay focused on the faltering economic recovery after the US Federal Reserve indicated willingness to commit to further quantitative easing measures on Tuesday. The Dow edged down 21.72 points or 0.2 percent to 10,739.31, coming off highest levels since May 2010. Earlier in the week, the US Fed stated that it decided to keep interest rates at record lows, as expected and announced that it is prepared to provide additional accommodation if needed.
The Australian stocks closed in green though the gains were modest as weak closing on Wall Street in the previous session and a continued firm undertone in the Australian dollar, which lingered near a two year high against the US dollar, kept the buying in resource stocks under check. Minors egged up in late trade though with Rio hitting 5-month high. The benchmark S&P/ASX200 Index added 8.4 points, or 0.2% to close at 4633.6, while the broader All Ordinaries Index pushed up by 5.3 points, or 0.1%, to 4680.
In Mumbai, the key benchmark indices recovered after falling sharply to the day's low triggered after European stocks fell on weak economic data and as US index futures declined. The spike in food inflation in the latest week rekindled worries that the central bank may interfere to check it earlier than expected. The market fell for the second straight day. The BSE 30-share Sensex was provisionally down 95.15 points or 0.48% up close to 75 points from the day's low and off close to 150 points from the day's high. The S&P CNX Nifty closed below the psychological 6000 mark after scaling that level in opening trade.
On economic front, the wholesale food price index rose 15.46% while the fuel price index climbed 11.48% in the year to 11 September 2010, government data on Thursday showed. In the prior week, annual food and fuel inflation stood at 15.10% and 11.48% respectively.
The US dollar rose from a five month low in late Asian trades, following the modest setback in stocks as some risk aversion flipped back in the markets and benefited safe havens like dollar and Gold. In other markets, Jakarta Composite index in Indonesia shed 0.18%, KLSE Composite in Malaysia shed 1.13% while Straits Times index in Singapore slipped by 0.42%. DOW futures fell into red and accelerated losses during the day, currently down 51 points. Dollar quotes at 1.3322 against the Euro, pulling crude oil lower. WTI Crude quotes at $74.15, down 56 cents on the day after recording a low of $73.89 per barrel.
