More weakness in Asian shares after losses in the US overnight
City Index November 16, 2011 9:41 PM
<p>Asian stocks are tipped for more losses following a weak finish in U.S. markets. The S&P500 was 1.7% lower at the close after financials led […]</p>
Asian stocks are tipped for more losses following a weak finish in U.S. markets. The S&P500 was 1.7% lower at the close after financials led the market lower on comments from Fitch that further contagion from Europe is likely to spill over into U.S. banks.
In a statement, Fitch said it believed that unless the Eurozone debt issue was resolved soon, and in an orderly fashion, the broad credit outlook for the world largest economy could negate the banking industry and worsen current exposures.
Chinese exposures performed badly in the U.S. market session also. China Life was down around 5% at the close while a key investment bank dropped coverage of LDK Solar – a Chinese solar wafers and panels manufacturer.
In regional economic news, another ratings agency Moody’s noted India’s government debt to GDP at 70% was preventing the country from attaining an investment grade rating and more measures would be needed to get the ratio in order. Moody’s current rates India’s rupee sovereign debt as Ba1 which is in line with countries such as Indonesia and Morocco.
In regional currencies, the Japanese Yen continues its gradually appreciation despite intervention efforts earlier this month. The USD/JPY pair was last trading just below the 77.00 level, drifting above and below. The AUD/USD is eyeing parity, last slightly above at 1.008 ahead of the equity markets opening.