Tokyo: Asian stocks slipped on Thursday after Wall Street continued to pull back from record highs ahead of Friday’s closely-watched US jobs data, while the nervous euro languished at an 11-year low prior to the European Central Bank’s (ECB) policy meeting.
MSCI’s broadest index of Asia-Pacific shares outside Japan shed 0.4% with Australian, Malaysian and Chinese stocks posting losses. Still, optimism stemming from widespread monetary easing supported other stock markets. Japan’s Nikkei edged up 0.2% and South Korea’s Kospi inched 0.1% higher. “Foreigners are continuing their buying spree on the back of increased global liquidity after quantitative easing by the ECB,” said Lee Kyung-min, economist at Daishin Securities Co. in Seoul. Before slipping on Tuesday for the second successive session, both the Dow and S&P hit record highs on Monday, when the Nasdaq reached a 15-year peak. Risk asset markets, shored up by liquidity provided by easing-minded central banks around the world, will have a chance to confirm the ECB’s easing stance when it holds a policy meeting later in the session. The ECB, which starts its quantitative easing (QE), or bond-buying, programme of more than €1 trillion this month, is expected to detail the plan after the meeting. Edgy before the ECB’s announcement on details of its QE scheme, the euro fell as far as $1.1061, a low not seen since September 2003. “This (ECB €1 trillion programme) would not be so euro negative if the Federal Reserve were doing the same thing but not only did the US central bank end its QE last October, but they are looking to take the next step and raise interest rates,” said Kathy Lien, managing director for forex strategy at BK Asset Management. “It is the reminder of this divergence that has driven EUR/USD to fresh 11-year lows.” The euro’s weakness helped the dollar index rise to a new 11-year high of 96.059.
