Asian stocks started the week in negative sign, thus extending the worst weekly slide since 2012 achieved last week. Markets were made nervous by tensions in Crimea following the disputed vote on re-annexation with Russia. We also note an increase in metal prices, gold in the lead, and a strengthening yen against the US dollar. Finally, China has relaxed its grip on the yuan. The MSCI Asia Pacific Index was down 0,2% as of 9:45 am in Tokyo, while Japan's Topix Index was down 0,4 percent. Gold was up 0,3% for the fifth consecutive day. The yen, recovering from a 1,9% jump last week, was stable at 101,42 against the dollar.
Preliminary results would indicate that 95% of voters in the Black Sea region chose to leave Ukraine and rejoin Russia in a referendum deemed illegal by the European Union and the United States. In China, the central bank doubled the yuan's trading range over the weekend, a sign that China's economic slowdown is putting pressure on the currency. "Investors are nervously eyeing China right now," said Adrian Mowat, chief strategist for Asia and emerging markets at JPMorgan Chase in Hong Kong. “This, in addition to the Crimean situation can only create a challenging environment for equity markets this week.”
The Nikkei 225 Stock Average was little changed after plunging 6,2% last week, marking the worst performing stock among developed countries. The MSCI Asia Pacific lost 3,5% last week, the first fall in five weeks. Australia's S&P/ASX 200 was down 0,1% while New Zealand's NZX 50 was down 0,3%. Bucking the trend, South Korea's Kospi was up 0,2% after losing 2,8% last week.
