In This Article:
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Equities weak across Asia in wake of Fed minutes
* China tensions, coronavirus weigh on some markets
* Oil falls, gold rises as sentiment weakens
By Stanley White and Chibuike Oguh
TOKYO/NEW YORK, Aug 20 (Reuters) - Asian equities and U.S. futures fell on Thursday, hurt by the U.S. Federal Reserve's cautious view of the economy, tensions with China and new clusters of coronavirus infections.
MSCI's broadest index of Asia-Pacific shares outside Japan slid 1.79%, the biggest daily decline in five weeks. U.S. stock futures were down 0.55%.
Australian stocks dropped 0.91% due to concern that ties with China will worsen further after a report that Australian regulators will reject acquisitions by a Chinese company.
Shares in China fell 1.28% due to dwindling expectations for additional monetary easing after the People's Bank of China kept a benchmark lending rate unchanged on Thursday.
Japanese stocks slid 1.06%. South Korean stocks tumbled 3.26%, the biggest daily decline since June 15, amid a spike in coronavirus cases in Seoul.
Euro Stoxx 50 futures were down 1.36%, German DAX futures fell 1.31%, and FTSE futures was off 1.27%.
Market sentiment had been bullish up until Fed policymakers' comments highlighted uncertainties over the U.S. recovery, with the S&P 500 and the Nasdaq hitting all-time highs driven largely by Apple Inc..
The iPhone maker's shares rose 1.4% to make the first publicly listed U.S. company reach $2 trillion in market capitalisation, while strong results from retailers Target and Lowe's also lifted sentiment.
The positive mood quickly faded, however, after several Fed members said additional easing may be needed because a rebound in employment was already slowing.
The downbeat tone spilled over into Asia, which weighed on equities and oil futures but pushed gold prices higher due to economic uncertainty.
"It was a decent day for banks, Apple, and Nike but everything else was in the reverse after the Fed said economic conditions will be difficult for a while," said Jamie Cox, managing partner at Harris Financial Group.
"We've seen some good numbers out of retail but there's uncertainty that these companies won't replicate those earnings without some stimulus."
Minutes from the Fed's July meeting showed the swift rebound in employment seen in May and June had likely slowed and that additional "substantial improvement" in the labour market would hinge on a "broad and sustained" reopening of business activity.