Asia shares lose steam as Wall Street sags

GMT 07:14 2015 Wednesday ,06 May

Arab Today, arab today Asia shares lose steam as Wall Street sags

Asian stocks lost steam
Hong Kong - AFP

Asian stocks lost steam on Wednesday, with most leading indexes in retreat after US markets slumped on worries about surging oil prices and growing tensions over the Greek debt crisis.

Sydney tumbled 1.53 percent, Seoul was down 1.13 percent and Hong Kong slipped 0.29 percent in early trade. Tokyo was closed for a holiday.

Chinese shares bucked the trend, with Shanghai rising 0.87 percent to recover some ground after the index plunged more than four percent the previous session on worries over new share issues that tightened liquidity.

But most markets took their lead from Wall Street, after the Dow Jones Industrial Average dropped 142.20 points or 0.79 percent to 17,928.20, weighed down by a rise in US oil prices above $60 a barrel.

"Markets are a little tired," Wayne Wilbanks, chief investment officer at US-based Wilbanks, Smith & Thomas Asset Management told Bloomberg Television.

"Investors are starting to wake up to the reality that there's not a whole lot of growth currently in the market. China is slowing down. What we have there is huge monetary stimulus which is causing this stock market semi-bubble," he said.

Analysts also cited a sharp rise in the US trade deficit in March and the growing rift between Greece and its creditors over the terms of a bailout. European stocks fell sharply Tuesday, with Germany's DAX 30 dropping 2.5 percent and France's CAC 40 losing 2.2 percent.

Oil prices were trading at 2015 highs as reports of rising tensions in petroleum-producer Libya raised fears of a Middle East supply disruption, analysts said.

US benchmark West Texas Intermediate for June delivery gained 48 cents to $60.88, while Brent crude for June rose 33 cents to $67.85.

Both contracts on Tuesday closed at levels unseen since early December.

In currency markets, the US dollar softened against the yen and euro following weak US trade data that raised questions about whether a planned interest rate hike by the Federal Reserve could be pushed back.

The greenback rose to 119.93 yen from 119.87 yen in New York, but down from 120.15 yen in Asia on Tuesday.

The euro was flat at $1.1185 while rising to 134.16 yen from 134.08 yen.

Gold fetched 1,195.18 against 1,188.70 late Tuesday.

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