Tighter Monetary Policy Signal Spooks Markets, Global Stock Selloff Continues
Posted: September 12, 2016 Filed under: Asia, Breaking News, Economics, Global | Tags: Associated Press, Bank of Japan, Central bank, Chair of the Federal Reserve, Dow Jones Industrial Average, EUROPE, European Central Bank, Federal Reserve System, Hong Kong, Janet Yellen, Japan, Monetary policy, Nikkei 225, South Korea, SSE Composite Index, Wall Street Leave a comment
Loose Money Party Peaks, Hangover Anticipation Looms.
“Central banks get most of the credit for the calm and upward-moving market over the summer, but I don’t think we can depend on that going forward.”
— Jeff Layman, chief investment officer at BKD Wealth Advisors
Markets in Europe and Asia retreated Monday amid signs the world’s central banks will be less accommodative than previously expected.
“Bourses in Asia closed with steep declines, with shares in Hong Kong off around 3.3%, Shanghai down 1.9%, Japan down 1.7% and Australia down 2.2%.”
“Central banks get most of the credit for the calm and upward-moving market over the summer, but I don’t think we can depend on that going forward,” said Jeff Layman, chief investment officer at BKD Wealth Advisors.
The Stoxx Europe 600 shed 1.9% early in the session, while futures pointed to a 0.6% opening loss for the S&P 500 after its biggest daily drop since the U.K.’s EU referendum.
Bourses in Asia closed with steep declines, with shares in Hong Kong off around 3.3%, Shanghai down 1.9%, Japan down 1.7% and Australia down 2.2%.
The Federal Reserve Building in Washington, U.S. There are heightened expectations for an interest rate rise by the Fed later this year. Photo: Reuters
Stocks and long-dated government bonds sold off on Friday after comments from Federal Reserve Bank of Boston President Eric Rosengren heightened expectations for an interest rate rise later this year.
The yield on the 10-year Treasury note rose to 1.696% on Monday from 1.671% on Friday, its highest afternoon yield since June, while German 10-year bonds climbed to 0.057%.
A speech by Fed official Lael Brainard, known to oppose rate rises, is scheduled…(read more)
Source: WSJ
pundit from another planet 