Asian shares set for mostly weaker open after Fed

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Asian shares were set to drift lower on Thursday as concerns about the strength of the recovery from the COVID-19 pandemic remained, even after the U.S. Federal Reserve pledged to hold interest rates near zero until at least 2023.

FILE PHOTO: People wearing protective masks, following the coronavirus disease (COVID-19) outbreak, are reflected on a screen showing stock prices outside a brokerage in Tokyo, Japan August 31, 2020. REUTERS/Kim Kyung-Hoon 17 Sep 2020 08:00AM(Updated: 17 Sep 2020 02:25PM) Share this content

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TOKYO: Stocks fell and the dollar advanced on Thursday after the Federal Reserve pledged to keep interest rates low for a long time but stopped short of offering further stimulus to shore up a battered U.S. economy.

European stocks are expected to follow suit, with the futures for the bellwether Euro Stoxx 50 index trading 0.96per cent lower in early trade.

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MSCI’s broadest index of Asia-Pacific shares outside Japan lost 1.01per cent, running out of steam after five straight days of gains. Japan’s Nikkei shed 0.63per cent.

U.S. S&P 500 futures fell 1.03per cent in Asia on Thursday following a 0.46per cent drop in the S&P 500 on Wall Street.

Tech shares fared worse, with the Nasdaq Composite dropping 1.25per cent on Wednesday. Nasdaq futures fell 1.14per cent in Asia.

“In essence, high-tech shares were overbought and we’ve seen a correction since early this month,” said Soichiro Monji, chief strategist at Nishimura Securities in Kyoto. “I think that is still continuing, with the Fed just being a fresh trigger.”

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The Fed said it would keep interest rates near zero until inflation is on track to “moderately exceed” the central bank’s 2per cent inflation target “for some time.”

New economic projections released with

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