MANILA, Philippines (AP) — Asian shares fell Friday as expectations of further stimulus following Britain’s vote to leave the European Union were tempered by the European Central Bank’s decision to keep its monetary policy intact. Comments by the Bank of Japan governor ruling out “helicopter money” for the tepid economy also cast a chill.
Japan’s Nikkei 225 fell 1.2 percent to 16,609.19. Hong Kong’s Hang Seng index shed 0.4 percent to 21,904.53. China’s Shanghai Composite Index was down 0.6 percent at 8,067.30. Australia’s S&P ASX 200 slipped 0.3 percent to 5,493.80. South Korea’s KOSPI shed 0.1 percent at 2,011.83. Southeast Asian markets were down.
Stocks fell Thursday after a mixed set of earnings reports disrupted the market’s recent record-setting run. Airlines dropped on worries that falling fares will hurt their profits. The Dow Jones industrial average sank, breaking a nine-day winning streak, its longest in three years. It lost 0.4 percent to 18,517.23. The Standard & Poor’s 500 index also fell 0.4 percent, to 2,165.17. The Nasdaq composite sank 0.3 percent, to 5,073.90.
“Central banks were all but prepared to come up with some coordinated action if the Brexit vote has rained fire and brimstone on global financial markets. But it did not,” said Bernard Aw of IG. “So central bankers are quite at a loss of what to do. Add more stimulus? Don’t add more stimulus? And they decided to stick to a safer option – wait and see.”
BOJ Gov. Haruhiko Kuroda’s comments ruling out so-called “helicopter money,” or direct cash injections into the economy, were recorded a month ago but aired Thursday by BBC. The remarks pushed the yen higher against the dollar, in turn pulling shares lower.
U.S. crude gained 3 cents to $44.78 in New York. On Thursday, it sank $1 to settle at $44.75 per barrel. Brent crude, the global benchmark, gained 1 cent to $46.21. It fell 97 cents to $46.20 a barrel in London on Thursday.
The dollar rose to 105.87 yen from 105.76 the previous day. The euro edged down to $1.1022 from $1.1027 on Thursday.