Asian stocks fall amid Hong Kong pro-democracy protests, dollar up

Bloomberg: Asian stocks fell on losses in Hong Kong due to pro-democracy disorders in the city. The greenback extended gains and Standard & Poor’s 500 Index futures descended as U.S. economic data prompted the outlook for higher interest rates.

“It’s going to spook some investors who are worried that this could drag out, affecting the business climate in Hong Kong,” Vasu Menon, vice president of wealth management at Oversea-Chinese Banking Corp., said on Bloomberg TV from Singapore. “It’s happening at a time when the U.S. Federal Reserve is talking about tightening monetary policy, a time when China is slowing down.”

The Hang Seng Index lost 1.9 percent by 1:41 p.m. in Tokyo, erasing its gain for the year and dragging the MSCI Asia Pacific Index toward a 0.7 percent decline.

All 50 stocks on the Hang Seng Index fell today, while a gauge of Chinese shares in the city retreated 1.8 percent in a third day of decline. Profits at industrial companies in China declined last month for the first time in two years, data at the weekend showed, as a slowdown in the world’s second-largest economy deepens.

The Shanghai Composite Index pared a gain of as much as 0.7 percent. The Hang Seng China AH Premium index, which measures the weighted-average price difference between dual-listed shares in the mainland versus Hong Kong, rose through the 100 level that shows the gap being erased. Mainland Chinese trading venues close for five days from Wednesday.

The Hong Kong dollar, which is allowed to trade within a tight band versus the U.S. currency, slipped for a sixth day and is at its weakest level since March. The city’s one-year interest-rate swap rose three basis points, the most in 15 months, to 0.485 percent.

Yuan slips, kiwi flies, greenback advances

Thousands of protesters remained near the government’s main offices in the Admiralty district, blocking some roads into and out of the central business area. Even as the streets calmed down, workers said they would go on strike, and protesters pledged to return.

China’s yuan slipped 0.2 percent to 6.1399 per dollar in onshore trade and retreated as much as 0.3 percent outside the mainland.

Aussie dollar descended 0.6 percent to 87.09 U.S. cents, touching its lowest level since January.

The kiwi plunged as much as 2 percent to 77.09 U.S. cents, the lowest level since Aug. 5 last year and is set for a 3.9 percent retreat since Sept. 24. New Zealand’s central bank said it sold a net NZ$521 million in August, the most since July 2007. Prime Minister John Key said the so-called Goldilocks level for the nation’s currency is around 65 U.S. cents, Interest.co reported, citing comments to reporters.

Indonesia’s rupiah retreated to a seven-month low after lawmakers voted to scrap direct elections for local officials.

Meanwhile, the dollar spot index, which tracks the greenback against 10 major peers, rose to 1,068.65, heading for its highest close since June 2010.

S&P 500 futures are indicating the U.S. equity benchmark may start the week lower after its biggest weekly loss in almost two months. The guage reached a record Sept. 18. Nasdaq 100 Index fell 0.2 percent.

The Fed mustn’t “fall behind the curve” as it weighs when to start raising interest rates, Dallas Fed President Richard Fisher said, citing strengthening U.S. growth and building wage-price pressures.

Nickel for delivery in three months dropped as much as 2.5 percent to $16,550 a metric ton on the London Metal Exchange amid easing concern that the Philippines will legislate an ore-export ban. If prices settle below $16,800, or 20 percent down from the closing high of $21,000 on May 13, the metal will slip into a bear market.

West Texas Intermediate crude fell as much as 0.7 percent from the highest price in seven days as concern eased over the risk of a supply disruption in the Middle East. Brent declined in London.

Futures capped a second weekly increase on Sept. 26 to trade at the smallest discount to Brent in a year as ample oil supplies shielded the global market from the U.S. military campaign against Islamic State.