Asian stocks suffer from fears of Syria intervention

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HONG KONG: Asian markets were mostly lower Tuesday as fears of military intervention in Syria added to concerns over when the US Federal Reserve would taper a massive stimulus program.

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US Secretary of State John Kerry warned Syria it would face action over the “moral obscenity” of a chemical weapons attack, as expectations grow that Washington and its allies are preparing to launch a punitive missile strike.

Tokyo ended down 0.69 percent and Seoul closed 0.11 percent lower. But Sydney gained 0.11 percent on profit-taking, following early losses after some poor earnings reports—including a mammoth loss of $770 million for Billabong.

Hong Kong closed down 0.59 percent while Shanghai was up 0.34 percent.

Shares in PetroChina, China’s largest oil company by capacity, were suspended in Hong Kong and Shanghai pending an announcement related to unspecified “major events.”

Oil prices rose over fears of renewed instability in the Middle East. New York’s main contract, West Texas Intermediate for delivery in October, was up 30 cents to $106.22 a barrel in afternoon trade. Brent North Sea crude for October added 32 cents to $111.05.

India led a tumble among currencies in emerging markets, with the rupee sinking to a new record low of 66.09 to the dollar, before recovering slightly to 65.91 against 64.14 Monday afternoon.

The Indonesian rupiah edged down to 10,840 from 10,770 while the Philippine peso also touched a 30-month low of 44.45 to the US unit.

The rupee’s slide came as India’s finance minister insisted the government could afford a vast new food program for the poor designed to “wipe out” malnutrition, despite concern about its impact on the public finances.

The dollar was at 97.97 yen in afternoon trade, down from 98.51 yen in New York on Monday afternoon.

The euro bought $1.3337 and 130.68 yen compared with $1.3369 and 131.68 yen.

The fears of military action come as expectations of an end to the US stimulus program have seen investors in recent months repatriate some of the vast sums that have poured into emerging economies, hitting currencies and equities. AFP

Some speculate the US central bank will announce the start of its tapering of the bond-buying program at the September 17 to 18 meeting of the policy-setting Federal Open Market Committee.

AFP

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