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Asia: Stocks retreat after deadly Brussels bombings

Wednesday, March 23, 2016 - 12:49

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[TOKYO] Asian stock markets edged lower on Wednesday, with airlines taking the biggest hit in the aftermath of the deadly Brussels bombings, dealers said.

The losses tracked a sell-off in tourism-linked stocks in the United States and Europe on Tuesday after explosions in the Brussels subway and Zaventem airport just outside the Belgian capital, claimed by the Islamic State group, left around 35 dead and more than 200 injured.

However, the main US and European markets recovered from early losses to finish little-changed on Tuesday, while overall declines in Asia were modest.

Bernard Aw, Singapore-based market analyst at IG, said that the initial market reaction to the bombings was expected, but that investors quickly retraced losses.

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"This is because the impact of terror attacks on financial markets has become less and less dramatic in recent years, compared with the aftermath of the September 11 attacks," Mr Aw wrote in a note to clients, referring to the events of 2001 in the US.

"Asia may be more resilient today, where cautious trading should prevail." Around 0240 GMT, Sydney-listed Qantas was down 0.61 per cent, Cathay Pacific in Hong Kong lost 0.25 per cent, All Nippon Airways dropped 0.51 per cent in Tokyo and Seoul-listed Korean Air Lines declined 1.64 per cent.

The losses came after a sell-off in travel and tourism related stocks during New York and European trading.

In the US, Expedia, TripAdvisor and Priceline sank after the blasts.

InterContinental Hotels Group, Lufthansa, Air-France KLM and IAG, the parent of Iberia and British Airways, all slipped in Europe.

American Airlines, United and Delta, which fly between the US and Europe, also fell.

But the London, Frankfurt and Paris bourses all managed to carve out slight gains, recovering from initial falls after news of the explosions broke.

Even Brussels' BEL 20 index tacked on 0.2 per cent.

On Wall Street, the Dow and the S&P 500 closed lower, while the Nasdaq finished up.

Most major Asian stock markets fell, with Tokyo, Shanghai and Hong Kong retreating. Trading in Sydney, Seoul and Taipei was also in the red.

In currencies, the safe haven yen edged higher against major peers as dealers digested the bombings.

The dollar slipped to 112.29 yen from 112.35 yen in New York late Tuesday while the euro fell to 125.94 yen from 126.01 yen.

The single currency was barely changed against the greenback, changing hands at US$1.1214 against US$1.1216 in US trade.

Oil prices opened lower in early deals, as worries about global oversupply ahead of a major producers' meeting in Qatar in April continue to dictate prices.

West Texas Intermediate was down 46 cents to US$40.99 and Brent dropped 41 cents to US$41.38 around 0215 GMT.

But overall the bombings in Brussels were having little impact on oil trading, analysts said.

AFP

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