Asian stocks and U.S. equity-index futures tumbled with emerging-market currencies while the yen, gold and Treasuries gained as tensions over Russia’s intervention in Ukraine intensified. Wheat climbed the most since August as the crisis stoked supply concerns.
The MSCI Asia Pacific Index dropped 1 percent by 12:23 p.m. in Tokyo and Standard & Poor’s 500 Index futures fell the most in a month as U.S. Secretary of State John Kerry flies to Kiev today. The yen added 0.3 percent versus the greenback, which strengthened against emerging-market currencies from South Korea to Poland. Gold climbed 1.3 percent and Brent crude jumped as much as 1.9 percent. Ten-year Treasury yields slipped to an almost one-month low and Asian bond risk rose. Wheat surged as much as 4.5 percent and corn rose to a five-month high.
The U.S. is weighing sanctions against Russia, the world’s largest energy exporter, after President Vladimir Putin got lawmakers to endorse troop deployments and Ukraine said soldiers were already in the Crimea region. Chinese manufacturing gauges for February signaled slower growth before officials prepare to meet this week on policy targets. A purchasing managers’ index of euro zone factory output is due today before U.S. reports on consumer spending and factory activity.
“Risk aversion is the name of the game as Treasuries and the yen are rallying as is gold, while oil is up as Russia is a major exporter,” said Dariusz Kowalczyk, a strategist at Credit Agricole CIB in Hong Kong. “Markets are increasingly concerned over escalation of the conflict in Ukraine and emerging currencies are suffering from contagion. Chinese PMI is weak and shows the manufacturing sector continues to deteriorate, and that is negative for China’s growth.”
About four stocks dropped for each that rose on the Asia- Pacific equity gauge, which capped its first monthly advance since October last week. All but one of 10 industries on the measure declined today, led by materials producers.
Australia’s S&P ASX/200 Index slid 0.6 percent. The Kospi index in Seoul fell 0.9 percent after North Korea fired two short-range missiles, days after launching four rockets into the sea off its eastern coast, South Korea’s defense ministry said.
The Hang Seng Index retreated 0.7 percent. The Hang Seng China Enterprises Index of mainland companies listed in the city pared declines after a purchasing managers’ index from HSBC Holdings Plc and Markit Economics matched estimates for it to fall to 48.5, the weakest in seven months.
Japan’s Topix index retreated 1.9 percent, with just one of 33 industries advancing, as the yen touched 101.26 per greenback, its highest in almost a month. Japan Tobacco Inc., which has 36 percent of the Russian cigarette market, plunged the most in two months.
The yen, viewed by investors as a haven asset, climbed 0.5 percent to 139.75 per euro while the euro dropped 0.2 percent to $1.3779. New Zealand’s currency halted a two-day advance, falling 0.4 percent to 83.56 U.S. cents.
In emerging markets, Poland’s zloty weakened 0.8 percent to 3.0376 per dollar and the Czech koruna retreated 0.2 percent, while Hungary’s forint lost 0.6 percent. The Korean won dropped 0.4 percent to 1,071.76 a dollar.
Gold for immediate delivery traded at $1,343.29. Prices advanced 6.6 percent last month after a 3.2 percent gain in January, and reached a 17-week high of $1,345.46 on Feb. 26. Holdings in ETPs expanded 0.4 percent in February after contracting last year for the first time since the first product was introduced in 2003. Silver added 1.2 percent.
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