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Asian markets mixed as traders assess ECB’s perceived dovishness

Friday 03.20 BST

What you need to know

  • Dollar hovers at 11-month low
  • Euro holding at highest since August 2015
  • Power Assets jumps 11 per cent on earnings

Asia Pacific equities put in a mixed showing as the US dollar hovered at 11-month lows and the euro held at a two-year high as the market digested comments from the European Central Bank’s president.

Hot topic

The US dollar was languishing at 11-month lows after falling to its lowest since August on a report that Robert Mueller, the special counsel who investigating possible ties between the Trump campaign and Russia, had expanded his probe to transactions involving the president’s businesses. The dollar index, a measure of the currency against a basket of peers, was flat at 94.303.

“The market may not be keen to see this trend reverse any time soon. The upcoming week brings us the next Federal Open Market Committee meeting with no changes expected and a more accommodative Fed still on the stage. Conviction of a US dollar recovery may not be strong here,” said Jingyi Pan, market strategist with IG.

The euro was flat at $1.1625 after climbing to its highest against the US currency since August 2015 on Thursday as the market viewed comments from European Central Bank president Mario Draghi as dovish.

The Japanese yen was 0.1 per cent lower at ¥112.03.

The Australian dollar slipped 0.4 per cent to $0.792 after hitting its two-year high earlier this week. This as investors await speeches from Reserve Bank of Australia officials scheduled for Friday.

Equities

In Australia the S&P/ASX 200 was off 0.6 per cent as financials fell 0.6 per cent and materials lost 1.3 per cent. BHP Billiton declined as much as 2 per cent after Elliott Advisors said it had “deep concerns” over the miner’s multibillion-dollar plan to enter the fertiliser market.

Japan’s Topix index was down 0.3 per cent snapping two days of gains as financials fell 0.8 per cent. Camera maker Nikon rose as much as 3 per cent after Nomura boosted its outlook for lithography equipment.

In Hong Kong the Hang Seng index was flat, struggling to notch a 10th consecutive day of gains to match a winning streak recorded in November 2011. Li Ka-shing’s Power Assets jumped as much as 11.1 per cent after the company reported net profit for the six months to June rose 16 per cent to HK$4.02bn ($515m).

Forex

Fixed income

The yield on 10-year US treasuries, which moves inverse to price, was down 0.7 basis points at 2.262 per cent. The yield on 10-year Japanese government bonds slipped 0.6bp to 0.062 per cent, while that for Australia was down 1 basis point at 2.723 per cent.

Commodities

Brent crude was down 0.1 per cent at $49.27 a barrel after briefly rising above $50 a barrel for the first time in six weeks on Thursday. US marker West Texas Intermediate was flat at $46.89 a barrel.

Gold was holding at a three-week high at $1,245.00 an ounce.

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