Asian
markets sank Wednesday following a big sell-off on Wall Street, with
Tokyo hit by profit-taking after an eight-day rally while fears that
Greece will default on its debt obligations dragged the euro down.
An
upbeat batch of US data has put wind back in the sails of the dollar,
which is sitting near an eight-year high against the yen as the chances
of an interest rate hike increase.
Hong Kong fell 0.49 percent,
Sydney shed 0.76 percent and Seoul lost 1.50 percent, while Tokyo was
down 0.10 percent and Shanghai gave up 0.53 percent.
US traders fled to the sidelines Tuesday as they returned from a long weekend to a strong dollar, which hurts exporters.
Modest
improvements in US consumer confidence, home sales and prices, and
orders for core industrial goods pointed to a pick-up in growth in the
world's biggest economy.
The data, along with comments Friday from
Federal Reserve chief Janet Yellen that she expects to hike interest
rates "at some point this year", put upward pressure on the dollar.
In early trade the greenback was at 123.19 yen in Tokyo, against 123.09 yen in New York late Tuesday.
The greenback on Tuesday rose past 123.30 yen briefly, its highest since mid-2007.
"Whether
it's durable goods, housing data or consumer confidence, US data are
all above market expectations," Hiroichi Nishi, a manager at SMBC Nikko
Securities in Tokyo, told Bloomberg News.
"This leads to the view that the rate hike will come within this year."
On Wall Street the Dow tumbled 1.04 percent, the S&P 500 fell 1.03 percent and the Nasdaq lost 1.11 percent.
The
long-running saga over Greece's bailout reform continues to drag on
confidence, with the country unable to reach an agreement with its
creditors that will release much needed cash to help it avoid a default.
With
a June 5 repayment deadline for Athens, the two sides are still no
closer to a deal that will unlock the last batch of bailout money. There
are fears that a Greek default could see the country tumbling out of
the eurozone, spooking global investors.
The euro was at $1.0871
and 133.91 yen Wednesday, compared with $1.0879 and 133.92 yen in US
trade. The single currency has plunged from $1.1149 and 134.54 yen last
week owing to the Greek worries.
On oil markets US benchmark West
Texas Intermediate for July delivery rose 36 cents to $58.39 while Brent
crude for July gained 29 cents to $64.01.
Gold fetched $1,187.05 compared with $1,195.35 late Tuesday.
By AFP
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