Markets settle as they await Syria developments
AP and AFPLONDON/HONG KONG--Financial markets settled down Wednesday following the previous day's big moves when an easing of concerns over an imminent U.S.-led military strike on Syria sent stocks sharply higher and oil prices down.
September 12, 2013, 12:12 am TWN
Though U.S. President Barack Obama said in a televised address Tuesday that he has told the American military to stay prepared to attack Syria if needed, he voiced his backing for a Russian proposal for Syria to give up its chemical weapons to international control.
With Damascus indicating its support for the plan, investors have largely breathed a sigh of relief that a strike and all the possible regional repercussions may be averted — geopolitical worries, particularly when related to the oil-rich Middle East, are rarely conducive to risk-taking in the investing community.
In Europe, the FTSE 100 index of leading British shares was down 0.1 percent at 6,579 while Germany's DAX rose 0.4 percent to 8,482. The CAC-40 was 0.1 percent lower at 4,113.
Wall Street was poised for a flat opening, with both Dow futures and the broader S&P 500 futures unchanged. .
With little economic news scheduled later, the focus of attention in the markets will likely remain on developments regarding Syria.
On Friday, investors will be closely monitoring U.S. retail sales data for August as they gear up for next week's policy meeting of the Federal Reserve. Over recent weeks, the markets have priced in the likelihood that the Fed will start to reduce its monetary stimulus at the meeting. The main question for most traders how much the US$85 billion of monthly asset purchases will be reduced.
Asian markets mostly edged up on Wednesday, with a rally on Wall Street and optimism about the state of the global economy helped by receding fears of a U.S.-led strike on Syria.
However, profit-taking capped gains after the previous two days' advances, while firms linked to Apple dipped in a lackluster response to its latest range of iPhones.
Tokyo ended flat owing to a late sell-off as dealers cashed in after a four percent gain since the weekend that was fuelled by Japan's successful bid to host the 2020 Olympics and stronger-than-expected growth data.
The Nikkei ended 1.71 points higher at 14,425.07, while Sydney added 0.64 percent, or 33.2 points, to 5,234.4 — a 2013 high. Seoul closed 0.49 percent higher, advancing 9.79 points to 2,003.85.
Shanghai rose 0.15 percent, adding 3.28 points to end at 2,241.27, after another round of Chinese indicators that suggest the world's number two economy is picking up after a slowdown this year. However, Hong Kong was 0.17-percent, or 39.51-points, lower at 22,937.14, ending four straight sessions of gains.
Gold cost US$1,361.73 an ounce at 1045 GMT compared with US$1,372.04 late Tuesday.