Asian markets drop after Fed’s lack of urgency

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SINGAPORE Asian stock markets retreated Thursday after U.S. central bank policymakers made no firm decision on when to unwind their support measures for the economy.

Regional indices tracked losses on Wall Street. The lack of a directive from the Federal Reserve fueled worries over surging coronavirus infections caused by the delta variant, and the pandemics impact on consumer spending and jobs growth.

Tokyos Nikkei 225 NIK, -1.10% slipped 0.7%. The Kospi 180721, -1.93% in South Korea lost 1.4% and the Shanghai Composite Index SHCOMP, -0.57% gave up 0.7%.

Hong Kongs Hang Seng HSI, -2.13% was down 1.8% and Sydneys S&P/ASX 200 XJO, -0.50% declined 0.4%. Stocks fell in Singapore STI, -1.40%, Taiwan Y9999, -2.68% and Indonesia JAKIDX, -2.06%.

Minutes of the Feds July 27-28 meeting, released Wednesday, indicated that most officials in attendance thought it was appropriate to begin reducing the pace of asset purchases this year.

The minutes only emphasized the central bankers uncertainty about the path of the economy and monetary policy heading into 2022, Matt Weller, global head of research at FOREX.com and City Index, wrote in a note.

Taken together, the initial read through of the minutes paints a mixed picture: while most Fed policymakers are expecting to start tapering this year, there were still several who would prefer to wait for next year, he said.

The focus has shifted to next weeks Jackson Hole Symposium. Traders will scrutinize Fed Chair Jerome Powells keynote speech for hints about the timing of a taper announcement, Weller added.

Stocks fell broadly on Wall Street on Wednesday. The benchmark S&P 500 SPX, -1.07% shed 1.1% to 4,400.27 in its biggest decline since mid-July.

The Dow Jones Industrial Average DJIA, -1.08% fell 1.1% to 34,960.69. The Nasdaq composite COMP, -0.89% lost 0.9% to 14,525.91.

In energy markets, benchmark U.S. crude CLU21, -3.59% fell $1.16 to $64.30 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude BRNV21, -3.05%, the price standard for international oils, shed $1.05 to $67.18 per barrel in London.

A surprise rise in US gasoline inventories has more than offset a drop in its crude stockpile, Venkateswaran Lavanya of Mizuho Bank said.

This underpins concerns that delta risks may be getting in the way of travel, she added.

Meanwhile, the dollar USDJPY, -0.10% advanced to 110.17 yen from Wednesdays 109.76 yen.

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