- Asian equities fell on Friday, as global stocks maintained their best year-to-date performance since 2019. Currency and bond movements were tepid.
- The MSCI Asia-Pacific Index fell 0.4%, pulled down by shares in Hong Kong, Japan, and Australia, although it remains on track for its best year in three years. Chinese stocks rose for a second day on hints that investors are considering a return to the damaged market.
- In 2023, the region's equities have shown resiliency, with gains building up steam in recent months on signs that the Federal Reserve may decrease rates next year. Nonetheless, they have lagged global rivals, pulled down by concerns about China's economic malaise, a rise of food inflation as drought inundates rice fields, and investors beginning to position themselves for elections in the coming year.
- "The notion that the major central banks have surely done enough to quell the inflationary surge of 2022-23 is powering the rally," said Brian Barish, chief investment officer at Cambiar Investors. "It's not difficult to imagine new things for markets to be concerned about, such as elections, the US government's sizable bond funding needs, and/or any notion that inflation will resurge again." But for the time being, there isn't much news and there aren't many sellers."
