Mon Jul 25, 2011
By Kevin Plumberg
SINGAPORE (Reuters) - Stocks fell while the Swiss franc rose and gold hit a record high on Monday as hopes for a political deal to avert a U.S. default began to fade, though investors were mostly seeking to protect their portfolios with no signs of panic selling.
Equity markets in Asia were down between 0.8 percent to 2.1 percent, and U.S. stock futures fell 1.1 percent, while the benchmark 10-year U.S. Treasury yield rose four basis points to 3 percent.
Investors have been whipsawed in the past few months by hope and disappointment over policymakers' ability to halt sovereign debt crises in the euro zone and the United States.
The focus was squarely on Washington now after European leaders scraped together a second bailout for Greece last week.
Republicans and Democrats in the U.S. Congress were each trying to put together their own plan after talks with President Barack Obama broke down over the weekend, heightening fears of a catastrophic U.S. debt default that could roil the global economy.
Investors said they still mostly viewed the headlines coming out of Washington as political theatre and expected an eleventh-hour solution before an August 2 deadline when the U.S. Treasury said it would not be able to borrow any more funds. They have continued all the while, though, to cut their exposure to risky assets.
"Despite the ever-frustrating horse-wrangling between the Democrats and Republicans, which could result in a downgrade of the U.S. government debt ranking, I still believe that some kind of temporary deal will be struck in the last minute," said Khiem Do, head of Asian Multi-Asset with Baring Asset Management in Hong Kong.
"Overall, we remain positive on the solid economic and investment outlook for Asia, which may actually be considered as the 'safe haven' while the debt concerns and consumer de-leveraging in Japan, Europe and the U.S. continue," Do said.
Japan's Nikkei share average fell 0.8 percent, led by shares of clothing chain company Fast Retailing that were down 1.7 percent after hitting a 13-month high last Friday. For more visit
Reuters
By Kevin Plumberg
SINGAPORE (Reuters) - Stocks fell while the Swiss franc rose and gold hit a record high on Monday as hopes for a political deal to avert a U.S. default began to fade, though investors were mostly seeking to protect their portfolios with no signs of panic selling.
Equity markets in Asia were down between 0.8 percent to 2.1 percent, and U.S. stock futures fell 1.1 percent, while the benchmark 10-year U.S. Treasury yield rose four basis points to 3 percent.
Investors have been whipsawed in the past few months by hope and disappointment over policymakers' ability to halt sovereign debt crises in the euro zone and the United States.
The focus was squarely on Washington now after European leaders scraped together a second bailout for Greece last week.
Republicans and Democrats in the U.S. Congress were each trying to put together their own plan after talks with President Barack Obama broke down over the weekend, heightening fears of a catastrophic U.S. debt default that could roil the global economy.
Investors said they still mostly viewed the headlines coming out of Washington as political theatre and expected an eleventh-hour solution before an August 2 deadline when the U.S. Treasury said it would not be able to borrow any more funds. They have continued all the while, though, to cut their exposure to risky assets.
"Despite the ever-frustrating horse-wrangling between the Democrats and Republicans, which could result in a downgrade of the U.S. government debt ranking, I still believe that some kind of temporary deal will be struck in the last minute," said Khiem Do, head of Asian Multi-Asset with Baring Asset Management in Hong Kong.
"Overall, we remain positive on the solid economic and investment outlook for Asia, which may actually be considered as the 'safe haven' while the debt concerns and consumer de-leveraging in Japan, Europe and the U.S. continue," Do said.
Japan's Nikkei share average fell 0.8 percent, led by shares of clothing chain company Fast Retailing that were down 1.7 percent after hitting a 13-month high last Friday. For more visit
Reuters
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