Asia stocks drift lower as Fed, China weakness weigh

Staff Writer
Columbus CEO

NEW YORK (AP) — Asian stocks drifted mostly lower Wednesday as investor sentiment was kept in check by the prospect of higher U.S. interest rates following improved economic data as well as the lingering fears about China's weakening growth.

KEEPING SCORE: Japan's benchmark Nikkei 225 index slipped 0.4 percent to 19,638.90 and South Korea's Kospi lost less than 0.1 percent to 2,040.23. Hong Kong's Hang Seng climbed 0.4 percent to 24,490.77 while the Shanghai Composite Index in mainland China lost 1.1 percent to 3,652.57. Australia's S&P/ASX 200 was practically unchanged at 5,967.60, hovering near its highest level in more than seven years. Southeast Asian indexes were mixed.

INVESTOR INDECISION: Markets were mostly in a holding pattern as investors turned cautious following recent economic data on the world's two biggest economies. U.S. government data showed that in February consumer prices rose in for the first time in four months while new home sales climbed to their fastest pace in seven years. That was a good sign for the world's No. 1 economy that nonetheless also raises concerns the Fed could soon raise interest rates. The reports came after HSBC's preliminary purchasing managers' index showed Chinese manufacturing activity slumped to the lowest in 11-months, signaling further weakness in the second biggest economy.

MARKET VIEW: "It remains to be seen whether we are going through a period of equilibrium, where bulls and bears even each other out, or simply a period where traders are happy to ride out the end of a good quarter by staying on the sidelines," Nicholas Teo of CMC Markets in Singapore wrote in a commentary.

WALL STREET: U.S. stocks ended slightly lower Tuesday as latest report on consumer prices and signs of possible renewed strength in the dollar left investors indecisive. The Standard & Poor's 500 fell 0.6 percent to 2,091.50 while the Dow Jones Industrial Average slipped 0.6 percent to 18,011.14. The Nasdaq composite fell 0.3 percent to 4,994.73.

ENERGY: Benchmark U.S. crude futures lost 10 cents to $47.41 in electronic trading on the New York Mercantile Exchange. The contract rose 6 cents to close at $47.51 a barrel. Brent crude, a benchmark for international oils, slipped 3 cents to $55.08 in London.

CURRENCIES: The dollar slipped to 119.62 yen from 119.75 in the previous session. The euro strengthened to $1.0926 from $1.0914.