With Tokyo gaining on a broadly weaker yen, MSCI’s main indicator of Asian shares hit a 10-year peak, but Europe’s main markets all dipped in early trade. Apple suppliers including AMS, IQE and Dialog fell by 2 to 5 % at the opening, with traders citing the later than expected November 3 shipping date for the new iPhone as the main reason.
That followed a small fall in Apple shares as Wall Street surged back to record highs on Tuesday. “There has been just a minor retracement, hardly an indication of which way the European session will be headed today,” analysts from Italy’s Unicredit said in a morning note.
“If there is anything that surprises us equity bulls, it is the almost linear nature of the (global) move without severe setbacks.” The pan-European STOXX 600 dipped 0.3 % as weakness in chip makers was compounded by a drop in miners.
Chip makers have been the best-performing among Europe’s tech stocks this year, accounting for a large chunk of the sector’s outperformance. AMS shares have gained 165 % year-to-date. “The economics of the Apple announcement are interesting because it will really test this theory that inflation is going to be weak,” said Mike Bell, a JP Morgan Asset Management global market strategist in London.
“With the iPhone coming in at about $1000 (R13100) it will be interesting to see how healthy demand is. If it’s relatively healthy I think it shows that there is still quite a lot of pricing power for US companies and that consumers have confidence.” In currency markets the dominant trend this week has been a recovery for the dollar and sterling.
The dollar hit a 12-day high above 110 yen in Asian time before easing back as traders awaited US inflation numbers today. Britain’s pound hit a one-year high above $1.33 and a six-week high on a trade-weighted basis. “Now it’s ‘wait and see’ for dollar investors,” said Esther Reichelt, a strategist with Commerzbank in Frankfurt.
After a soft start in Europe, oil prices were marginally higher, with Opec’s expectations of higher demand next year countering reports of rising US crude stockpiles.