Asian shares down as data casts doubt on recovery
SINGAPORE, May 3 — Asian shares slipped today and the euro wallowed near a two-week low after disappointing data from both sides of the Atlantic rekindled concerns about the strength of the global economic recovery.
US stocks eased yesterday as data showed a slowdown in private sector hiring, tempering the optimism from a better-than-expected manufacturing survey at the start of the week that had driven the Dow to its highest in more than a year.
MSCI’s broadest index of Asia Pacific shares outside Japan slipped 0.1 per cent, with South Korean shares down 0.3 per cent. Tokyo financial markets were closed for a public holiday.
European shares also fell yesterday after a survey showed euro zone factories sank further into decline last month, with the downturn hitting Italy and Spain hard and appearing to take root among core members France and Germany.
The data had knocked the euro down nearly one per cent to US$1.3122. Today the currency was trading around US$1.3150, down a touch on the day.
With recently-downgraded Spain looking to raise funds in the bond market today, the European Central Bank will be under pressure at its policy meeting to do more to shield weaker euro zone members from additional pain.
“It seems too early for another wave of easing, but that is where the risks are skewed. The outcome is continued downward pressure on EUR/USD,” said Sebastian Galy, strategist at Societe General.
Gold, which in recent months has lost its safe-haven appeal and mostly tracked the performance of riskier assets, dipped 0.1 per cent to around US$1,651 (RM4,953) an ounce. — Reuters