Global Markets Drift Lower as Asian Funds Slide

On Thursday, September 24, only 2 of the 8 tracked international markets ended the session higher. The world fund closed -0.1%, moving in step with the US market fund, which also finished -0.1%. European funds held up best, led by Eurozone +0.2% and United Kingdom +0.1%, while Asian markets lagged sharply, dragged down by steep declines in Japan -1.3% and South Korea -1.7%.

These numbers capture how international funds traded in New York at the Thursday close. Because these figures come from US-listed funds, Japan is how Japan looked to a US investor at the New York close.

The primary pressure across international markets came from a sharp rise in energy costs and global bond yields. A jump in global crude prices above $100 a barrel combined with sharply higher US Treasury yields to lift inflation concerns and reinforce expectations of tighter central bank policy. Across Asia, Japan -1.3% and India -1.0% dropped under that pressure. Even though local markets in Seoul were closed for the Chuseok holiday, the US-listed fund for South Korea -1.7% dropped to rank as the session's weakest performer, reflecting pressure across emerging Asian equities.

European funds fared better by comparison, as energy shares rose 1.1% to cushion markets against elevated European bond yields and oil costs. The fund tracking Eurozone +0.2% gained modestly, while Germany 0.0% ended unchanged, supported in part by an uptick in German business sentiment. Elsewhere, broader emerging market sentiment stayed weak, leaving China -0.7% and Emerging Markets -0.7% lower on the day.

On the calendar, several scheduled economic reports are in focus. In Europe, scheduled releases include German consumer climate data alongside euro-area monetary and balance-sheet statistics. In the United States, scheduled reports include advance durable goods orders and the final consumer sentiment survey, which provide readings on business investment and consumer expectations.