Asian equities declined Thursday as the dollar’s sustained strength and weakness in China weighed on the region’s risk appetite. Japanese stocks climbed as the yen fell.
The MSCI Asia Pacific Index slid as much as 0.5%, with shares in China and Taiwan trading lower while those in Australia edged up. Hong Kong shares dropped amid thin volumes as the market stayed open despite signs of severe weather.
An index of dollar rose nearly 0.2% to its two-year high, while the 10-year US Treasury yield gained for a third day in Asian trading.
US stocks futures fell. Assets in the region have slumped since the US election as investors assess the impact of President-elect Donald Trump’s proposed tariff policies on the region’s growth, while the surging dollar pressures the region’s currencies.
The MSCI’s Asia stock benchmark is on pace for its worst week since April, while a Bloomberg gauge of Asian currencies has dropped over 1% so far this week.
“The strength in the US dollar will likely be a key overhang” for the region’s stocks, said Jun Rong Yeap, a strategist at IG Asia Pte.
