Major Asian markets closed out a volatile week with sharp losses in Hong Kong and early turbulence in Japan, as falling gold prices and renewed speculation over the next U.S. Federal Reserve Chair sent investors scrambling, according to China Global Television Network (CGTN) market analyst Timothy Pope.
Hong Kong's stock market ended lower Friday with the benchmark Hang Seng Index down 2.08 percent to close at 27,387.11 points.
"The Hong Kong market tumbled today, and Japan's stocks did early on as well. Once again, the gold price slipping and then failing to find a floor and falling further was a huge drag. But here we also saw more exposure to the reasons behind that. We saw investors rotating out of gold and into the greenback again amid speculation over the imminent announcement of Donald Trump's pick for the next Fed Chair. Donald Trump has teased the announcement of Jerome Powell's successor, which should happen sometime fairly soon, and the bets are that it will be Kevin Warsh a former Fed governor who has been a critic of the central bank in recent times. He's on record as being an advocate of lower interest rates and a smaller Fed balance sheet, and the markets were chewing that over today. He'd obviously need to be confirmed by the Senate, but the markets were reacting to the fact that he's a bit less of an extreme choice than some of the other names which have been kicked around recently," said Pope.
"So the Hang Seng ended down by 2.1 percent, with the usual suspects down, including a lot of the same names we've been talking about on the Chinese Mainland, Zijin Mining for one. Another notable today was CK Hutchison, which slumped 4.6 percent after Panama's Supreme Court voided a number of the company's port contracts for operations along the Panama Canal. You'll recall this making headline last year when CK Hutchison was talking about selling some of these ports. The court said the contracts were unconstitutional. And it's really unclear now where that's going to leave the sale of those CK Hutchison' assets. When asked about that today, the Chinese Foreign Ministry said China will take all necessary steps to defend the legitimate rights and interests of Chinese companies. So that's still very much developing," he added.
Meanwhile, the 225-issue Nikkei Stock Average ended down 52.75 points, or 0.1 percent, from Thursday at 53,322.85.
"Over in Tokyo we saw the Nikkei 225 slide initially but finish the session down only 0.1 percent on Fed and gold price market whiplash. The weakening yen helped support stocks later in the session as U.S. dollar buying picked up pace ahead of the market opening stateside. That did take some of the pressure off tech stocks, which had been hammered early on. They were the victims of some profit taking earlier in the day, although we did see chip equipment firm advanced test, the biggest drag on the market, still end down by 5 percent. But computer maker Fujitsu was on the other end of that seesaw, although it was up 5 percent after raising its annual net profit forecast by a whopping 93 percent. So, a pretty turbulent end to the week. Hopefully we can rest up ahead of whatever Monday's got in store for us," Pope reported.
Analyst recaps Asian stock markets' Friday performances
