The dollar hit a 12-year high against the euro Monday, ahead of a closely watched Federal Reserve policy meeting this week, while oil prices fell again as US supplies continued to build.
Shanghai was the stand-out stock market in the region, extending last week’s gains after Chinese Premier Li Keqiang said the government had enough in its armoury to support the world’s number two economy.
Shanghai jumped 2.27 percent, or 76.40 points, to 3,449.31 — its highest since August 2009 — and Hong Kong added 0.53 percent, or 126.34 points, to 23,949.55.
Tokyo’s Nikkei, which on Friday closed above 19,000 points for the first time in 15 years, edged down 8.19 points to finish at 19,246.06.
Sydney ended down 0.29 percent, or 16.8 points, at 5,797.7 while Seoul was marginally higher, adding 1.54 points to 1,987.33.
Investors are keeping their focus on the Fed’s policy meeting Wednesday, seeking a clearer timeline for when it will raise interest rates as the US economy strengthens.
World markets took a hit last week and the dollar rallied in reaction to a strong US jobs report that increased the likelihood of a summer rate rise.
But while equities have settled, the dollar continues to advance, hitting a more than 12-year high against the euro, which has also been battered by the European Central Bank’s new bond-buying stimulus programme.
In Tokyo, the euro fell to $1.0451 — its lowest since January 2003 — before ticking up slightly in the afternoon to $1.0545, compared with $1.0489 in New York. The single currency was also at 127.77 yen compared with 127.38 yen in US trade.
The dollar fetched 121.22 yen against 121.44 yen.
– Oil prices retreat –
“The Fed has never found itself on the other side of global policy and this central bank divergence is making the dollar the most sought-after currency on the planet,” Evan Lucas, a markets strategist in Melbourne at IG Ltd., wrote in a client note, according to Bloomberg News.
Oil prices fell further in Asia, extending Friday’s losses after the International Energy Agency warned that US inventories were nearing storage capacity and adding to a global supply glut.
US benchmark West Texas Intermediate for April delivery dipped 30 cents to $44.54, while Brent crude for April eased 49 cents to $54.18.
In China Premier Li said Sunday fresh measures could be taken to support the economy, which last year grew at its slowest pace in 24 years and is forecast to weaken this year as leaders try to move it from a reliance on exports and investment towards consumer spending.
Authorities have cut interest rates twice since November and also reduced the amount of cash banks must keep in reserve in a bid to boost lending.
But after the close of the National People’s Congress, China’s rubber stamp parliament, Li told reporters: “We still have a host of policy instruments at our disposal.”
Gold fetched $1,156.82 against $1,155.83 late Friday.
In other markets:
— Taipei fell 0.69 percent, or 66.44 points, to 9,512.91.
Taiwan Semiconductor Manufacturing Co closed 2.01 percent lower at Tw$146.0, while leading microchip design house MediaTek eased 3.57 percent to Tw$432.0.
— Wellington was flat, edging up 2.81 points to 5,911.39.
Spark was down 2.63 percent at NZ$3.15 while Fletcher Building rose 1.59 percent to NZ$8.97.
— Manila closed down 1.01 percent, or 78.59 points, at 7,730.95.
— Kuala Lumpur closed flat, down 1.21 points, at 1,780.54.
Telekom Malaysia lost 0.42 percent to 7.03 ringgit, Tenaga Nasional shed 0.14 percent to 14.62 ringgit, while Sime Darby added 0.11 percent to 9.26 ringgit.
— Jakarta ended up 0.16 percent, or 8.81 points, at 5,435.27.
Palm oil producer Astra Agro Lestari rose 1.56 percent to 26,025 rupiah, while cement manufacturer Indocement Tunggal Prakasa fell 0.11 percent to 22,175 rupiah.
— Singapore rose 0.39 percent, or 13.27 points, to 3,376.04.
Oversea-Chinese Banking Corporation fell 0.10 percent to Sg$10.30 while Singapore Telecom gained 0.48 percent to Sg$4.15.
— Bangkok lost 1.69 perent, or 25.98 points, to 1,515.57.
Telecoms company True Corporation dropped 4.51 percent to 12.70 baht, while oil company PTT fell 2.16 percent to 317.00 baht.
— Mumbai fell 0.23 percent, or 65.59 points, to end at 28,437.71.
Sesa Sterlite fell 5.16 percent to 185.50 rupees, while IT giant Infosys rose 2.28 percent to 2,267.00 rupees
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