Asia's post-FOMC relief rally fizzles out on inflation, China's growth concerns
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Anita Gabriel
THE rally across Asian markets at the start of Thursday's (May 5) trading session turned mixed as caution seeped back in after initial gains were sparked by the policy statement of the US Federal Open Market Committee (FOMC) last night that ruled out a jumbo 75 basis point rate hike in upcoming meetings.
The strong gains in US stocks overnight provided wind beneath their wings for key Asian gauges in China, which returned online after a 3-day break, Australia and Taiwan. The rest including Hong Kong, Singapore and Malaysia began on an upbeat note but soon ran out of steam as concerns over China's slowing growth and inflationary pressures took centrestage following the latest release of some key data.
The MSCI's broadest index of Asia-Pacific shares outside Japan was also down 0.4 per cent after an early rise. Markets in Japan, South Korea and Indonesia are closed for holidays today.
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