SYDNEY — Asian shares took a breather from their recent rally on Thursday as investors searched for fresh catalysts, while the yen came under some heavy selling pressure, particularly against the euro and Swiss franc.
Oil prices slipped, after surging over 2 percent overnight to seven-week peaks as a surprise drop in US crude inventories added to supply worries amid export issues in Iraq, Venezuela and Russia.
European stocks are set for a subdued open, with EUROSTOXX 50 futures off 0.1 percent. S&P 500 futures and Nasdaq futures were flat ahead of a lineup of Federal Reserve officials, whose remarks will be closely watched for their views on interest rates.
San Francisco Fed President Mary Daly said further rate cuts will likely be needed but the timing remained unclear. Earlier in the week, Fed Chair Jerome Powell had struck a cautious tone about further rate cuts, after the central bank delivered the first easing this year just last week.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.1 percent, having rallied over 5 percent for the month and 9 percent for the quarter. Japan’s Nikkei rose 0.2 percent, after jumping 7 percent for the month and 13 percent for the quarter.
“It must be said that fresh catalysts were lacking across the board, with little by way of impactful news or data-flow to move the needle especially much,” said Michael Brown, a senior research strategist at Pepperstone.
“Long equities also continues to make a lot of sense… The Fed’s ‘run it hot’ approach tilts risks to the outlook to the upside, and marks a restoration of the ‘Fed put’ dynamic with which participants have become so familiar over the years.”
