Asian markets tank as Trump crisis threatens economic agenda

By the break Tokyo had plunged 1.4 per cent, while Hong Kong shed 0.4 per cent, Sydney dived 1.3 per cent, Seoul was 0.5 per cent off and Singapore gave up 0.4 per cent. Shanghai lost 0.2 per cent, Wellington 0.7 per cent and Taipei 0.6 per cent. — Reuters picBy the break Tokyo had plunged 1.4 per cent, while Hong Kong shed 0.4 per cent, Sydney dived 1.3 per cent, Seoul was 0.5 per cent off and gave up 0.4 per cent. Shanghai lost 0.2 per cent, Wellington 0.7 per cent and Taipei 0.6 per cent. — Reuters pic

, May 18 — Asian nosedived today while the dollar suffered fresh selling on fears the intensifying crisis surrounding Donald Trump could lead to his impeachment and shatter any chances of his economy-boosting agenda being implemented.

Investors tracked the heaviest losses in New York since Trump was elected, following claims by recently fired FBI boss James Comey that the president pressed him to drop a probe into ex-national security advisor Michael Flynn’s links to Moscow.

That came a day after it was reported Trump had divulged classified information to Russia’s foreign minister, fanning further allegations about his own tied to the country’s leaders.



While the tycoon says he will be exonerated by a newly appointed special prosecutor who will look into the claims, analysts said the uncertainty is rocking markets globally.

There is a growing fear that Trump’s plans for tax cuts, big spending and red-tape slashing — which had fuelled a global equities and dollar rally his November election win — will be thrown off course.

“It’s all about president Trump this morning,” said Greg McKenna, chief market strategist at AxiTrader, said in a note.

“Impeaching Donald Trump was a pipe dream for the Democrats but extremely unlikely to most other observers until a few days ago,” he added. “As it drags on, it hurts sentiment and recently often threatens the administration’s agenda – especially around tax and infrastructure.”

Fears of collapse

By the break Tokyo had plunged 1.4 per cent, while Hong Kong shed 0.4 per cent, Sydney dived 1.3 per cent, Seoul was 0.5 per cent off and Singapore gave up 0.4 per cent. Shanghai lost 0.2 per cent, Wellington 0.7 per cent and Taipei 0.6 per cent.

There were also heavy losses in Manila and Jakarta.

“There is a very high level of uncertainty oozing from the markets but one thing that is crystal clear, investors now believe that at a minimum the rising US political entropy will jeopardise the White House policy agenda, and at the extreme, a Trump impeachment will lead to a flat out market collapse,” said OANDA senior trader Stephen Innes.



The uncertainty fanned a flight to safe assets, sending the yen and rallying, while the VIX gauge of volatility — also known as the fear index — soared 50 per cent.

The dollar tumbled as dealers began to reconsider the chances of a Federal Reserve interest rate hike next month, which had been widely expected.

In Asian trade the greenback sank below 111 yen for the first time since the end of April, while the euro — itself buoyed by easing uncertainty in the EU and a pick-up in eurozone economic fortunes — continued to levels not seen since Trump’s election win.

Key figures around 0230 GMT (1030 in )

Tokyo – Nikkei 225: DOWN 1.4 per cent at 19,529.70 (break)

Hong Kong – Hang Seng: DOWN 0.4 per cent at 25,188.09

Shanghai – Composite: DOWN 0.2 per cent at 3,097.50

Euro/dollar: UP at US$1.1166 from US$1.1157 at 2100 GMT



Dollar/yen: DOWN at 110.92 yen from 111.96 yen

Pound/dollar: UP at US$1.2970 from US$1.2967

Oil – West Texas Intermediate: DOWN 19 cents at US$48.88 per barrel

Oil – North Sea: DOWN 21 cents at US$52.00 per barrel

New York – Dow: DOWN 1.8 per cent at 20,606.93 (close)

London – FTSE 100: DOWN 0.3 per cent at 7,503.47 (close) — AFP

Source: The Malay Mail Online








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