June 24, 2024 (MLN):Asian markets extended last week's poor run with more losses Monday, following on from another tepid lead from Wall Street as profit-taking weighed on the tech sector, as APP reported.

A forecast-topping read on the US services sector provided further evidence that the world's top economy remained in rude health and dealt a blow to hopes for interest rate cuts.

Investors are also tracking developments in Japan as the yen flirts with three-decade lows against the dollar, leading the country's top currency official to warn authorities were ready to step in to provide support.

A surge in the tech sector has helped push markets to record or multi-year highs but concerns that the buying has gone too far have set in and profit-taking has weighed on equities in recent weeks.

That saw Wall Street end broadly lower Friday, with the better-than-expected read on the US services sector, which is at a more than two-year high, weighing on sentiment.

The next major indicator to come is the personal consumption expenditures (PCE) index, the Federal Reserve's preferred gauge of inflation, which could play a key role in the bank's plans for monetary policy.

Decision-makers have pushed back against speculation they could cut interest rates in September, with some even suggesting they are happy to keep them elevated into the new year.

Asian markets got off to a weak start, with Hong Kong, Shanghai, Sydney, Seoul, Singapore, Taipei and Wellington all in negative territory.

Tokyo, Manila and Jakarta edged higher.

The yen slipped further, and is approaching the 160.17 per dollar mark that forced authorities to intervene in currency markets earlier in the year.

The movement led vice finance minister Masato Kanda to say officials were ready to step in 24 hours a day.

"If there are excessive currency fluctuations, it has a negative impact on the national economy," he said.

"In the event of excessive moves based on speculation, we are prepared to take appropriate action."

The comments have helped keep the yen below 160 but US rate uncertainty was putting fresh pressure on the unit.

Tony Sycamore, at IG Australia, said: "We suspect the next round of intervention is likely to come after yen triggers buy orders perched above the late April 160.20ish high."

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Posted on: 2024-06-24T09:53:07+05:00