Decline at the Start of the Week: Investors on the Stock Markets Are Not Inclined to Riskier Investments

On Asian stock markets, stock prices fell after last week’s rise, as investors are not inclined to riskier investments ahead of the meeting of leaders of the American central bank, where interest rates will be decided.

The MSCI index of the Asia-Pacific region was down 0.5 percent around 7:00 AM, losing part of last week’s gains. Meanwhile, stock prices in Australia, South Korea, and Hong Kong fell between 0.4 and 1 percent, while in Shanghai they slightly increased. In Japan, there is no trading today due to a holiday.

Last week, Chinese stock markets rose, thanks to encouraging indicators from the local economy, but this morning the stock indices fell due to new problems in the real estate market.

– Despite encouraging signs of stabilization, the real estate sector remains a missing puzzle in the overall economic picture – says Tommy Xie, director of research at OCBC Bank.

The market is also negatively affected by the decline in stock prices on Wall Street on Friday, which caused the local stock indices to end the week with losses. Additionally, investors do not want to take risks ahead of meetings of the American and several other major central banks in the world. In the money market, there is more than a 90 percent chance that the Fed will not raise interest rates at the upcoming meeting. Furthermore, there is a 67 percent chance that they will not raise them in November either.

However, investors are cautious as surprises are always possible, and after this meeting, the Fed will also announce new projections regarding the economy and interest rates. There is great anticipation for what Fed Chairman Jerome Powell will say at the press conference on Wednesday.

The dollar slightly weakened, oil prices rose

On the currency markets, the value of the dollar against a basket of currencies slightly fell after nine weeks of continuous growth. The dollar index, which shows the value of the American currency against the other six major world currencies, is around 105.29 points this morning, while it was 105.33 points on Friday evening.

Meanwhile, the exchange rate of the dollar against the Japanese currency is stable around 147.80 yen. However, the American currency weakened against the European one, so the price of the euro rose by 0.10 percent to 1.0665 dollars.

Oil prices, on the other hand, have risen, entering their fourth week of growth. The price of a barrel on the London market strengthened by 0.71 percent to 94.60 dollars, while on the American market, a barrel increased by 0.90 percent to 91.57 dollars.