BEIJING: Chinese shares slid, cutting their gains since an interest-rate cut in half, while the dollar pared its fifth straight weekly retreat. Asian bonds followed gains in the U.S. and Europe, while oil headed toward its longest rising streak in 32 years.
The Shanghai Composite Index tumbled 2 percent by 12 p.m. in Tokyo, trimming its advance since China cut rates this week to 2 percent. The MSCI Asia Pacific Index fluctuated and Standard & Poor’s 500 Index futures were little changed after an all-time high. The Bloomberg Dollar Spot Index trimmed its drop since May 8 to 1 percent. Australian and Japanese bond yields fell. U.S. crude dropped, trimming its ninth straight weekly advance.
Chinese shares, which more than doubled over the last 12 months, are paring gains on concern that a slew of initial public offerings will tie up funds amid weak economic growth. With disappointing economic data damping the outlook for higher U.S. interest rates, the weaker dollar buoyed the outlook for U.S. exporters and drove the S&P 500’s first increase this week. Bond markets took a breather from the selloff that has erased more than $400 billion in value the past three weeks.
“China remains a concern,” Tim Schroeders, a portfolio manager who helps oversee about $1 billion in equities at Pengana Capital Ltd. in Melbourne, said by phone. “We need to see an improvement in the economy and a bottoming out of the property market.”
