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Stock Markets Wary in Face of Weather, Geopolitical Risks--Update

8 Sep 2017 5:14 am
By Ese Erheriene 

The dollar was hit by fresh selling in Asia Friday while stock markets traded without broad direction as weather-related and geopolitical concerns discouraged bold moves ahead of the weekend.

The U.S. Dollar Index, which measures the U.S. currency against six others, sank to another 32-month low in late-morning trading; against the euro, the dollar was at its weakest since January 2015. Some attributed the Friday weakness to safe-haven activity.

In that light, gold continued to climb in Asia, hitting fresh 1-year highs above $1,350 a troy ounce.

With potentially catastrophic Hurricane Irma hurtling toward Florida and North Korea gearing up for Saturday's Foundation Day holiday-- the occasion of a nuclear test last year--global risk appetite faded as the week came to a close.

"Movers in the region [have been] fraught with mixed returns," said Jingyi Pan, a strategist at IG Group, adding that concerns that North Korea will launch a missile this weekend seem to be weighing on stocks in South Korea and Japan.

South Korea's Kospi eased 0.1% while Japan's Nikkei fell 0.5%. Japanese electronics companies were hurt by the strong yen, which hit a 10-month high against the dollar overnight, while insurers were under pressure from sinking U.S. Treasury yields--the benchmark hit 2017 lows overnight. Yields had risen Thursday after the European Central Bank postponed releasing a timetable for phasing out its bond-buying efforts.

Wider worries about global interest rates remaining low also pressed Australia's stock benchmark, in which the country's big banks make up some one-quarter of the total weighting. The S&P/ASX 200 was recently down 0.5% as the banks suffered roughly 1% drops.

But some other Asian markets were rising solidly Friday: Hong Kong, Taiwan and New Zealand were notching roughly 0.5% gains while Chinese indexes finished morning trading up 0.3%. Stocks in China there got a lift from news trade rose further in August, especially on the import side; the trade surplus unexpectedly narrowed.

Amid reports of a production hiccup for Apple's next iPhone, set to be unveiled Tuesday, Taiwan-listed Apple suppliers were mostly higher but some Hong Kong-listed ones fell: Audio supplier AAC Tech slipped 0.7%, lens maker Sunny Optical fell 1.7% and smaller peer Q Tech slid 4.3%. Shares of all three have at least doubled this year.

Oil futures trended modestly higher throughout morning Asian trading as Hurricane Irma continues to take aim at Florida. The global Brent benchmark was recently up 0.5% at $54.75 per barrel.

Write to Ese Erheriene at ese.erheriene@wsj.com

(END) Dow Jones Newswires

September 08, 2017 01:14 ET (05:14 GMT)

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