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Asian faiths try to save swastika symbol corrupted by Hitler

Sheetal Deo was shocked when she got a letter from her Queens apartment building’s co-op board calling her Diwali decoration “offensive” and demanding she take it down.

“My decoration said ‘Happy Diwali’ and had a swastika on it,” said Deo, a physician, who was celebrating the Hindu festival of lights.

The equilateral cross with its legs bent at right angles is a millennia-old sacred symbol in Hinduism, Buddhism and Jainism that represents peace and good fortune, and was also used widely by Indigenous people worldwide in a similar vein.

But in the West, this symbol is often equated to Adolf Hitler’s hakenkreuz or the hooked cross – a symbol of hate that evokes the trauma of the Holocaust and the horrors of Nazi Germany. White supremacists, neo-Nazi groups and vandals have continued to use Hitler’s symbol to stoke fear and hate.

Over the past decade, as the Asian diaspora has grown in North America, the call to reclaim the swastika as a sacred symbol has become louder. These minority faith communities are being joined by Native American elders whose ancestors have long used the symbol as part of healing rituals.

Deo believes she and people of other faiths should not have to sacrifice or apologize for a sacred symbol simply because it is often conflated with its tainted version.

“To me, that’s intolerable,” she said.

Yet to others, the idea that the swastika could be redeemed is unthinkable.

Holocaust survivors in particular could be re-traumatized when they see the symbol, said Shelley Rood Wernick, managing director of the Jewish Federations of North America’s Center on Holocaust Survivor Care.

“One of the hallmarks of trauma is that it shatters a person’s sense of safety,” said Wernick, whose grandparents met at a displaced persons’ camp in Austria after World War II. “The swastika was a representation of the concept that stood for the annihilation of an entire people.”

For her grandparents and the elderly survivors she serves, Wernick said, the symbol is the physical representation of the horrors they experienced.

“I recognize the swastika as a symbol of hate.”

New York-based Steven Heller, a design historian and author of “Swastika: Symbol Beyond Redemption?”, said the swastika is “a charged symbol for so many whose loved ones were criminally and brutally murdered.” Heller’s great-grandfather perished during the Holocaust.

“A rose by any other name is a rose,” he said. “In the end it’s how a symbol affects you visually and emotionally. For many, it creates a visceral impact and that’s a fact.”

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The symbol itself dates back to prehistoric times. The word “swastika” has Sanskrit roots and means “the mark of well being.” It has been used in prayers of the Rig Veda, the oldest of Hindu scriptures. In Buddhism, the symbol is known as “manji” and signifies the Buddha’s footsteps. It is used to mark the location of Buddhist temples. In China it’s called Wàn, and denotes the universe or the manifestation and creativity of God. The swastika is carved into the Jains’ emblem representing the four types of birth an embodied soul might attain until it is eventually liberated from the cycle of birth and death. In the Zoroastrian faith, it represents the four elements – water, fire, air and earth.

In India, the ubiquitous symbol can be seen on thresholds, drawn with vermillion and turmeric, and displayed on shop doors, vehicles, food packaging and at festivals or special occasions. Elsewhere, it has been found in the Roman catacombs, ruins in Greece and Iran, and in Ethiopian and Spanish churches.

The swastika also was a Native American symbol used by many southwestern tribes, particularly the Navajo and Hopi. To the Navajo, it represented a whirling log, a sacred image used in healing rituals and sand paintings. Swastika motifs can be found in items carbon-dated to 15,000 years ago on display at the National Museum of the History of Ukraine as well as on artifacts recovered from the ruins of the ancient Indus Valley civilizations that flourished between 2600 and 1900 BC.

The symbol was revived during the 19th century excavations in the ancient city of Troy by German archaeologist Heinrich Schliemann, who connected it to a shared Aryan culture across Europe and Asia. Historians believe it is this notion that made the symbol appealing to nationalist groups in Germany including the Nazi Party, which adopted it in 1920.

In North America, in the early 20th century, swastikas made their way into ceramic tiles, architectural features, military insignia, team logos, government buildings and marketing campaigns. Coca-Cola issued a swastika pendant. Carlsberg beer bottles came etched with swastikas. The Boy Scouts handed out badges with the symbol until 1940.

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The Rev. T.K. Nakagaki said he was shocked when he first heard the swastika referred to as a “universal symbol of evil” at an interfaith conference. The New York-based Buddhist priest, who was ordained in the 750-year-old Jodoshinshu tradition of Japanese Buddhism, says when he hears the word “swastika” or “manji,” he thinks of a Buddhist temple because that is what it represents in Japan where he grew up.

“You cannot call it a symbol of evil or (deny) other facts that have existed for hundreds of years, just because of Hitler,” he said.

In his 2018 book titled “The Buddhist Swastika and Hitler’s Cross: Rescuing a Symbol of Peace from the Forces of Hate,” Nakagaki posits that Hitler referred to the symbol as the hooked cross or hakenkreuz. Nakagaki’s research also shows the symbol was called the hakenkreuz in U.S. newspapers until the early 1930s, when the word swastika replaced it.

Nakagaki believes more dialogue is needed even though it will be uncomfortable.

“This is peace work, too,” he said.

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The Coalition of Hindus of North America is one of several faith groups leading the effort to differentiate the swastika from the hakenkreuz. They supported a new California law that criminalizes the public display of the hakenkreuz — making an exception for the sacred swastika.

Pushpita Prasad, a spokesperson for the Hindu group, called it a victory, but said the legislation unfortunately labels both Hitler’s symbol and the sacred one as swastikas.

This is “not just an esoteric battle,” Prasad said, but an issue with real-life consequences for immigrant communities, whose members have resorted to self-censoring.

Vikas Jain, a Cleveland physician, said he and his wife hid images containing the symbol when their children’s friends visited because “they wouldn’t know the difference.” Jain says he stands in solidarity with the Jewish community, but is sad that he cannot freely practice his Jain faith “because of this lack of understanding.”

He noted that the global Jain emblem has a swastika in it, but the U.S. Jain community deliberately removed it from its seal. Jain wishes people would differentiate between their symbol of peace and Hitler’s swastika just as they do with the hateful burning cross symbol and Christianity’s sacred crucifix.

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Before World War II, the name “Swastika” was so popular in North America it was used to mark numerous locations. Swastika Park, a housing subdivision in Miami, was created in 1917, and still has that name. In 2020, the hamlet of Swastika, nestled in the Adirondack Mountains in upstate New York, decided to keep its name after town councilors determined that it predated WWII and referred to the prosperity symbol.

Swastika Acres, the name of a Denver housing subdivision, can be traced to the Denver Swastika Land Company. It was founded in 1908, and changed its name to Old Cherry Hills in 2019 after a unanimous city council vote. In September, the town council in Puslinch, Ontario, voted to change the name of the street Swastika Trail to Holly Trail.

Next month, the Oregon Geographic Names Board, which supervises the naming of geographic features within the state, is set to vote to rename Swastika Mountain, a 4,197-foot butte in the Umpqua National Forest. Kerry Tymchuk, executive director of the Oregon Historical Society, said although its name can only be found on a map, it made news in January when two stranded hikers were rescued from the mountain.

“A Eugene resident saw that news report and asked why on earth was this mountain called that in this day and age,” said Tymchuk. He said the mountain got its name in the 1900s from a neighboring ranch whose owner branded his cattle with the swastika.

Tymchuk said the names board is set to rename Mount Swastika as Mount Halo after Chief Halito, who led the Yoncalla Kalapuya tribe in the 1800s.

“Most people we’ve heard from associate it with Nazism,” Tymchuk said.

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For the Navajo people, the symbol, shaped like a swirl, represents the universe and life, said Patricia Anne Davis, an elder of the Choctaw and Dineh nations.

“It was a spiritual, esoteric symbol that was woven into the Navajo rugs, until Hitler took something good and beautiful and made it twisted,” she said.

In the early 20th century, traders encouraged Native artists to use it on their crafts; it appeared often on silver work, textiles and pottery. But after it became a Nazi symbol, representatives from the Hopi, Navajo, Apache and Tohono O’odham tribes signed a proclamation in 1940 banning its use.

Davis views the original symbol that was used by many Indigenous people as one of peace, healing and goodness.

“I understand the wounds and trauma that Jewish people experience when they see that symbol,” she said. “All I can do is affirm its true meaning — the one that never changed across cultures, languages and history. It’s time to restore the authentic meaning of that symbol.”

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Like Nakagaki, Jeff Kelman, a New Hampshire-based Holocaust historian, believes the hakenkreuz and swastika were distinct. Kelman who takes this message to Jewish communities, is optimistic about the symbol’s redemption because he sees his message resonating with many in his community, including Holocaust survivors.

“When they learn an Indian girl could be named Swastika and she could be harassed in school, they understand how they should see these as two separate symbols,” he said. “No one in the Jewish community wants to see Hitler’s legacy continue to harm people.”

Greta Elbogen, an 85-year-old Holocaust survivor whose grandmother and cousins were killed at Auschwitz, says she was surprised to learn about the symbol’s sacred past. Elbogen was born in 1938 when the Nazis forcibly annexed Austria. She went into hiding with relatives in Hungary, immigrated to the U.S. in 1956 and became a social worker.

This new knowledge about the swastika, Elbogen said, feels liberating; she no longer fears a symbol that was used to terrorize.

“Hearing that the swastika is beautiful and sacred to so many people is a blessing,” she said. “It’s time to let go of the past and look to the future.”

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For many, the swastika evokes a visceral reaction unlike any other, said Mark Pitcavage, senior research fellow at the Anti-Defamation League’s Center on Extremism who for the past 22 years has maintained the group’s hate symbols database.

“The only symbol that would even come close to the swastika is the symbol of a hooded Klansman,” he said.

The ADL explains the sanctity of the swastika in many faiths and cultures, and there are other lesser-known religious symbols that must be similarly contextualized, Pitcavage said. One is the Celtic cross – a traditional Christian symbol used for religious purposes and to symbolize Irish pride – which is used by a number of white supremacist and neo-Nazi groups.

Similarly, Thor’s hammer is an important symbol for those who follow neo-Norse religions such as Asatru. But white supremacists have adopted it as well, often creating racist versions of the hammer by incorporating hate symbols such as Hitler’s hakenkreuz.

“In the case of the swastika, Hitler polluted a symbol that was used innocuously in a variety of contexts,” Pitcavage said. “Because that meaning has become so entrenched in the West, while I believe it is possible to create some awareness, I don’t think that its association with the Nazis can be completely eliminated.”

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Associated Press religion coverage receives support through the AP’s collaboration with The Conversation US, with funding from Lilly Endowment Inc. The AP is solely responsible for this content.

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Asian stocks shaken by blast in Poland; dollar gains

HONG KONG, Nov 16 (Reuters) – Asian stocks dropped and the dollar gained on Wednesday after a blast in Poland that Ukraine and Polish authorities said was caused by a Russian-made missile.

Worries over a potential ratcheting up of geopolitical tensions spurred a drop of 1% in MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS).

Australian shares (.AXJO) fell 0.4%, while Japan’s Nikkei stock index (.N225) dropped 0.1%.

Hong Kong’s Hang Seng Index (.HSI) shed 1.1% and China’s CSI 300 (.CSI300) fell 0.4% by the midday break. The struggling property sector weighed on the markets, with China’s new home prices falling at their fastest pace in more than seven years in October, weighed down by COVID 19-related curbs and industry-wide problems.

U.S. stock futures, the S&P 500 e-minis , fell 0.2%.

In early European trade, the pan-region Euro Stoxx 50 futures lost 0.9%, German DAX futures dipped 1%, and FTSE futures fell 0.5%.

NATO member Poland said on Wednesday that a Russian-made rocket killed two people in eastern Poland near Ukraine, and it summoned Russia’s ambassador to Warsaw for an explanation after Moscow denied it was responsible.

“(It) interrupted what is a far more constructive tone in markets over the last three, four days,” said Dwyfor Evans, head of Asia Pacific macro strategy at State Street Global Markets in Hong Kong, who noted optimism in the financial markets that U.S. inflation was cooling.

U.S. President Joe Biden said the United States and its NATO allies were investigating the blast but early information suggested it may not have been caused by a missile fired from Russia.

“I do think President Biden’s comment was clear in representing the U.S. government,” said Quincy Krosby, chief global strategist at LPL Financial in Charlotte, North Carolina.

“Unless there’s evidence to the contrary, (market concerns) should dissipate.”

The safe-haven U.S. dollar pared gains against its major peers but was still mostly higher, led by a 0.63% advance versus the yen .

Sterling lost 0.32%, while the risk-sensitive Aussie dollar weakened 0.34%. The euro was flat.

“A lot of headlines are going on around today but there’s a feeling that this is not going to, at this stage… result in an escalation in tensions, or at least there is no appetite to go in that direction,” said Rodrigo Catril, senior currency analyst at National Australia Bank in Sydney.

The fact that the risk-sensitive, pro-growth Australia and New Zealand dollars retained most of their big gains from Tuesday, following soft U.S. PPI readings, is an indication that “there is a lot of appetite to push the U.S. dollar lower,” Catril said.

The yield on benchmark 10-year Treasury notes rose to 3.8068% in Tokyo, compared with 3.799% at the close of U.S. trading on Tuesday. It earlier fell as low as 3.757%, matching the previous session’s intraday trough, which was the lowest since Oct. 6.

U.S. crude dipped 0.74% to $86.29 a barrel. Oil prices rose on Tuesday after news that oil supply to Hungary via the Druzhba oil pipeline had been temporarily suspended due to a fall in pressure.

Gold was slightly lower, with spot gold trading at $1,778.17 per ounce.

Reporting by Xie Yu; Additional reporting by Ankur Banerjee; Editing by Edwina Gibbs and Edmund Klamann

Our Standards: The Thomson Reuters Trust Principles.

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Biden lands in Cambodia to meet Asian allies ahead of Xi meeting


Phnom Penh, Cambodia
CNN
 — 

President Joe Biden arrived in Phnom Penh, Cambodia, on Saturday morning local time for a series of summits and meetings between the US president and leaders of Southeast Asian nations.

The weekend of meetings in Cambodia comes ahead of the highly anticipated Group of 20 summit next week in Indonesia where Biden will meet with Chinese leader Xi Jinping for the first time in person since he took office. The Association of Southeast Asian Nations (ASEAN) meetings – along with Sunday’s East Asia Summit, which is also being held in Phnom Penh – will be a chance for the president to speak with US allies before sitting down with Xi.

Biden will hold a bilateral meeting with Cambodian Prime Minister Hun Sen as he looks to build on a summit between Biden and ASEAN leaders in Washington earlier this year.

Biden, national security adviser Jake Sullivan told reporters aboard Air Force One, “was intent on elevating our engagement in the Indo-Pacific” from the start of his presidency, and his attendance at the ASEAN and East Asia summits this weekend will highlight his work so far, including the Indo-Pacific Economic Framework announced earlier this year and security partnership efforts.

“He’s coming into this set of summits with that record of accomplishment and purpose behind him, and he wants to be able to use the next 36 hours to build on that foundation to take American engagement forward, and also to deliver a series of concrete, practical initiatives,” Sullivan said.

Among those practical initiatives, Sullivan noted, are new initiatives on maritime cooperation, digital connectivity, and economic investment. Biden is set to launch a new maritime domain effort “that focuses on using radio frequencies from commercial satellites to be able to track dark shipping, illegal and unregulated fishing, and also to improve the capacity of the countries of the region to respond to disasters and humanitarian crises,” Sullivan said.

Biden will also highlight a “forward-deployed posture” toward regional defense, Sullivan added, to show that the US was on the front foot in terms of security cooperation.

There will also be a focus on Myanmar and discussions on coordination “to continue to impose costs and raise pressure on the junta,” which seized power from the country’s democratically elected government in a February 2021 coup.

Four defining global threats are looming over Biden’s trip: Russia’s war in Ukraine, escalating tensions with China, the existential problem of climate change and the potential for a global recession in the coming months. Other flashpoints, like North Korea’s rapidly accelerating provocations and uncertainty over Iran’s nuclear program, will also factor in.

While in Phnom Penh, Biden will be meeting with the leaders of Japan and South Korea on Sunday following multiple weapons tests by North Korea, Sullivan said. The meeting is notable given the historic tensions between Japan and South Korea, and the relationship between the two staunch US allies has been one that Biden has attempted to bridge.

Both the Japanese and the South Koreans find themselves united in concern about Kim Jong Un’s missile tests, as well as the prospect of a seventh nuclear weapons test. North Korea has ramped up its tests this year, having carried out missile tests on 32 days in 2022, according to a CNN count. That’s compared to just eight in 2021 and four in 2020, with the latest launch coming on Wednesday.

Sullivan suggested the trilateral meeting will not lead to specific deliverables, but rather, enhanced security cooperation amid a range of threats.

The trio of world leaders, Sullivan told reporters, will “be able to discuss broader security issues in the Indo-Pacific and also, specifically, the threats posed by North Korea’s missile and nuclear programs.”

Sullivan said Thursday that the administration is concerned about the North Koreans conducting a seventh nuclear test but can’t say if it will come during the weekend of meetings.

“Our concern still remains real. Whether it happens in the next week or not, I can’t say,” Sullivan said earlier this week. “We are also concerned about further potential long-range missile tests in addition to the possibility of a nuclear test. And so, we’ll be watching carefully for both of those.”

But the Monday meeting with Xi in Bali, Indonesia, will undoubtedly hang over the summits in Cambodia, and will be part of those trilateral conversations.

“One thing that President Biden certainly wants to do with our closest allies is preview what he intends to do, and also ask the leaders of (South Korea) and Japan, ‘what would you like me to raise? What do you want me to go in with?’” Sullivan said, adding that it “will be a topic but it will not be the main event of the trilateral.”

Biden and Xi have spoken by phone five times since the president entered the White House. They traveled extensively together, both in China and the United States, when both were serving as their country’s vice president.

Both enter Monday’s meeting on the back of significant political events. Biden fared better than expected in US midterm elections and Xi was elevated to an unprecedented third term by the Chinese Communist Party.

US officials declined to speculate on how the two leaders’ political situations might affect the dynamic of their meeting.

The high-stakes bilateral meeting between Biden and Xi will center on “sharpening” each leader’s understanding of the others priorities, Sullivan told reporters.

That includes the issue of Taiwan, which Beijing claims. Biden has vowed in the past to use US military force to defend the island from invasion. The issue is among the most contentious between Biden and Xi.

Sullivan suggested the meeting will focus on a better understanding of positions on a series of critical issues, but is not likely to result in any major breakthroughs or dramatic shifts in the relationship.

Instead, “it’s about the leaders coming to a better understanding and then tasking their teams” to continue to work through those issues, Sullivan told reporters aboard Air Force One as Biden traveled to Cambodia.

The meeting, set to take place on the sidelines of the G-20 summit, was the result of “several weeks of intensive” discussions between the two sides, Sullivan said, and is viewed by Biden as the start of a series of engagements between the leaders and their teams.

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Asian shares fall ahead of U.S. CPI, crypto worries mount

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  • Dollar stays firm, crypto stokes spillover fears
  • European markets set to open lower
  • China mainland, Hong Kong shares battered by COVID case surge
  • Focus on U.S. inflation for signs of slowdown in Fed rate hike

SYDNEY, Nov 10 (Reuters) – Asian share markets pulled back on Thursday and the dollar held its overnight gains before the big test of a U.S. consumer inflation report, while market sentiment took a dive as the likely collapse of a major crypto exchange spooked investors.

With no final results available from the U.S. mid-term elections, investors were turning to upcoming inflation data later in the day, which is likely to show a slowing in both the monthly and yearly core numbers for October to 0.5% and 6.5%, respectively, according to a Reuters poll.

European markets are set to extend the cautious mood, with the pan-region Euro Stoxx 50 futures down 0.7%. However, U.S. S&P 500 futures edged up 0.2% while the Nasdaq futures rose 0.3%.

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 1.2%, dragged lower by a 1.0% drop in China’s bluechips (.CSI300) and a 1.8% retreat in Hong Kong’s Hang Seng index (.HSI).

Japan’s Nikkei (.N225) lost 1.0%.

China is again grappling with a COVID surge, with the southern metropolis of Guangzhou reporting thousands of cases. Apple Inc (AAPL.O) supplier Foxconn (2317.TW) plans to update its fourth-quarter outlook on Thursday, after strict COVID curbs remained in place at its major plant in China despite the lifting of a lockdown.

Elsewhere, focus remained squarely on inflation.

“The high probability is we see a number that is fairly in line with expectations – that is obviously harder to call, and we may need to wait for the guidance from Fed speakers in the session ahead to see how they interpret it,” said Chris Weston, head of research at brokerage Pepperstone.

Minneapolis Federal Reserve Bank President Neel Kashkari on Wednesday said it’s “entirely premature” to discuss any pivot away from the Fed’s current policy tightening.

A slew of Fed officials including Board Governor Christopher Waller, Bank of Philadelphia President Patrick Harker, Bank of Dallas President Lorie Logan will be speaking tonight.

The futures market currently showed investors believe the Fed could step down to a 50 basis point hike next month, while the target U.S. federal funds rate could peak around 5.1% by next June.

Overnight on Wall Street, shares ended lower as Republican gains in midterm elections appeared more modest than some had expected. Republicans were still favoured to win control of the House of Representatives but key races were too close to call.

In the crypto world, bitcoin rose 3.6% to $16,443 on Thursday, after tumbling for two straight sessions to its lowest level since late 2020.

Binance, the world’s biggest crypto exchange, said late on Wednesday that it had decided not to acquire smaller rival FTX, which has grappled with a severe liquidity crunch and faced bankruptcy without more capital.

“You can’t deny the growing correlation between bitcoin and risk assets. The FTX news is having an outsized effect on asset prices,” said Stephen Innes, managing partner at SPI Asset Management.

“Bitcoin spillovers are not negligible, and given how widely crypto coins are held, it could mean more forced liquidation of other assets to cover margin calls as long position investors were massively wrong-footed.”

The U.S. dollar on Thursday held onto most of its overnight gains against a basket of currencies.

The sterling gained 0.4% against the greenback to $1.1409, after tumbling 1.6% in the previous session.

U.S. Treasury yields were lower on Thursday.

The yield on benchmark 10-year notes eased 8 basis points to 4.0751% while the yield on two-year notes edged 3 basis points lower to 4.5963%.

In commodities, oil prices trimmed earlier losses on Thursday, after tumbling around 3% in the previous session on fears of demand from China and rising U.S. crude stocks.

U.S. crude oil futures was flat at 0.3% to $85.83 per barrel, while Brent crude futures stabilised at $92.71.

Gold was higher, with the spot price at $1,709.08 per ounce.

Reporting by Stella Qiu; Editing by Bradley Perrett and Sam Holmes

Our Standards: The Thomson Reuters Trust Principles.

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Live news updates: Asian markets mostly down as investors cautious after US sell-off

Wall Street equities closed at the lowest level since December 2020, while US Treasury yields lurched higher after intense volatility in Britain’s gilt market and a lacklustre sale of new Treasuries shook investor sentiment.

The blue-chip S&P 500 share index ended the day down 1 per cent after having lost 4.7 per cent over the course of the previous week. The technology-heavy Nasdaq Composite fell 0.6 per cent on Monday.

Monday’s wobble in equities came as the yield on the 10-year US Treasury note, a benchmark for global borrowing costs, added 0.22 percentage points to 3.92 per cent — the highest level since 2010. Bond yields rise when prices fall.

The selling in the US followed a brutal session in London, in which gilt yields surged for the second trading day in a row after the UK government’s plans for big tax cuts spooked investors. Britain’s 10-year gilt yield rose on Monday by its most in 40 years, according to Refinitiv data.

A sale of US two-year Treasuries on Monday also highlighted how fund managers are demanding the government pay higher borrowing costs on expectations the Federal Reserve will continue pushing interest rates sharply higher. 

Last week, the Fed led the charge on a series of interest rate rises by other global peers, implementing a third consecutive increase of 0.75 percentage points to a target range of 3 to 3.25 per cent.

The dollar, which tends to strengthen in times of economic and market stress, added 0.8 per cent against a basket of six peers, hitting a fresh 20-year high.

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Asian shares extend global rout, yen perks up on intervention hints

An electronic stock quotation board is displayed inside a conference hall in Tokyo, Japan November 1, 2021. REUTERS/Issei Kato

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  • https://tmsnrt.rs/2zpUAr4
  • Nikkei tumbles 2.3%, S&P 500 futures stabilise
  • Dollar falls 0.6% on yen on news of rate check from BoJ
  • 2-yr U.S. yields scale new 15-yr high of 3.8040%
  • U.S. yield curve remains deeply inverted

SYDNEY, Sept 14 (Reuters) – Asian stocks tumbled on Wednesday as U.S. data dashed hopes for an immediate peak in inflation, although the dollar paused its relentless run against the yen as Japan gave its strongest signal yet it was unhappy with the currency’s sharp declines.

Data on Tuesday showed the headline U.S. consumer price index gained 0.1% on a monthly basis versus expectations for a 0.1% decline. In particular, core inflation, stripping out volatile food and energy prices, doubled to 0.6%. read more

Wall Street saw its steepest fall in two years, the safe-haven dollar posted its biggest jump since early 2020, and two-year Treasury yields, which rise with traders’ expectations of higher Fed fund rates, jumped to the highest level in 15 years.

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The stock rout is set to hit European markets, with the pan-region Euro Stoxx 50 futures , German DAX futures and FTSE futures off more than 0.7%.

In Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 2.2% on Wednesday, dragged lower by a 2.4% plunge in resources-heavy Australia (.AXJO), a 2.5% drop in Hong Kong’s Hang Seng index (.HSI) and a 1.5% fall in Chinese bluechips (.CSI300).

Japan’s Nikkei (.N225) tumbled 2.6%.

After a heavy equity selloff overnight, both the S&P 500 futures and Nasdaq futures rose 0.2%.

“Markets have reacted violently to what I would consider to be a modest miss in U.S. CPI,” said Scott Rundell, chief investment officer at Mutual Limited.

“Futures have stabilised, so we might see a dead-cat bounce tonight.”

Financial markets now have fully priced in an interest rate hike of at least 75 basis points at the conclusion of the Fed’s policy meeting next week, with a 38% probability of a super-sized, full-percentage-point increase to the Fed funds target rate, according to CME’s FedWatch tool.

A day earlier, the probability of a 100 bps hike was zero.

“USD rates are now pricing in a Fed funds rate of 4.25% by end-2022 (75bps, 75bps, 25bps for the remaining three meetings). Decent odds of a 4.5% peak early 2023 is also reflected,” said Eugene Leow, senior rates strategist at Deutsche Bank.

“While resilient growth and slowing inflation can make for a better risk taking environment, the U.S. economy now looks too hot still. With no clear signs of the labour market slowing and inflation still problematic, a downshift from the Fed looks set to be delayed again.”

The strength of the U.S. dollar had pressured the rate sensitive Japanese yen close to its 24-year low at 149.96 yen before giving up some of the gains on news that the Bank of Japan has conducted a rate check in apparent preparation for currency intervention. read more

Yen-buying intervention is rare. The last time Japan intervened to support its currency was in 1998, when the Asian financial crisis triggered a yen sell-off and rapid capital outflows.

Earlier in the day, Japanese Finance Minister Shunichi Suzuki said that currency intervention was among options the government would consider. read more

The dollar now hovered at 143.7 yen , down 0.6% for the day.

Many traders remained doubtful that intervention was imminent, but the jump in the yen pointed to rising nerves. The timing of the BOJ’s move also suggests that 145 per dollar will be an important level for markets and the authorities.

The two-year U.S. Treasury yield scaled a new 15-year high of 3.8040% on Friday before retreating to 3.7629%, and its curve gap with the benchmark 10-year yields widened to around 34 basis points, compared with just 16 basis points a week ago.

The yield curve inversion is usually treated as a warning of recession.

The 10-year Treasury note yield held steady at 3.4178%.

Oil prices edged lower on Friday. U.S. crude settled down 0.6% at $86.82 per barrel and Brent eased by a similar margin at $92.65.

Gold was slightly higher. Spot gold was traded at $1703.02 per ounce.

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Reporting by Stella Qiu; Editing by Stephen Coates, Ana Nicolaci da Costa and Sam Holmes

Our Standards: The Thomson Reuters Trust Principles.

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Asian markets open lower after price data slam Wall Street

Asian markets skidded lower on Wednesday after Wall Street fell the most since June 2020 as a report showed inflation has kept a surprisingly strong grip on the U.S. economy.

Tokyo’s benchmark Nikkei 225 lost 2.8% in early trading Wednesday, to 27,816.58, while Sydney’s S&P/ASX 200 declined 2.5% to 6,834.80. In Seoul, the Kospi lost 2.6% to 2,386.29.

U.S. futures edged higher, with the contracts for the Dow industrials and the S&P 500 up 0.1%. European futures also declined.

On Tuesday, the Dow lost more than 1,250 points and the S&P 500 sank 4.3%. Tuesday’s hotter-than-expected report on inflation has traders bracing for the Federal Reserve to raise interest rates still more, adding to risks for the economy.

The steep sell-off didn’t quite knock out the market’s gains over the past four days, but it ended a four-day winning streak for the major U.S. indexes and erased an early rally in European markets.

The S&P 500 sank 4.3% to 3,932.69. The Dow fell 3.9% to 31,104.97 and the Nasdaq composite closed 5.2% lower, at 11,633.57.

Bond prices also fell sharply, sending their yields higher, after a report showed inflation decelerated only to 8.3% in August, instead of the 8.1% economists expected.

The yield on the two-year Treasury, which tends to track expectations for Fed actions, soared to 3.74% from 3.57% late Monday. The 10-year yield, which helps dictate where mortgages and rates for other loans are heading, rose to 3.42% from 3.36%.

The hotter-than-expected reading has traders bracing for the Federal Reserve to ultimately raise interest rates more than expected to combat inflation, with all the risks for the economy that entails.

“Right now, it’s not the journey that’s a worry so much as the destination,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments. “If the Fed wants to hike and hold, the big question is at what level.

All but six of the stocks in the S&P 500 fell. Technology and other high-growth companies fell more than the rest of the market because they’re seen as most at risk from higher rates.

Most of Wall Street came into the day thinking the Fed would hike its key short-term rate by a hefty three-quarters of a percentage point at its meeting next week. But the hope was that inflation was falling back to more normal levels after peaking in June at 9.1%.

Such a slowdown might let the Fed reduce the size of its rate hikes through the end of this year and then potentially hold steady through early 2023.

Tuesday’s report dashed some of those hopes. Many of the data points were worse than economists expected, including some the Fed pays particular attention to, such as inflation outside of food and energy prices.

Markets honed in on a 0.6% rise in such prices during August from July, double what economists expected, said Gargi Chaudhuri, head of investment strategy at iShares.

Traders now see a one-in-three chance the Fed will hike the benchmark rate by a full percentage point next week, quadruple the usual move. No one in the futures market was predicting such a hike a day earlier.

The Fed has already raised its benchmark interest rate four times this year, with the last two increases by three-quarters of a percentage point. The federal funds rate is currently in a range of 2.25% to 2.50%.

Higher rates hurt the economy by making it more expensive to buy a house, a car or anything else bought on credit. Mortgage rates have already hit their highest level since 2008, creating pain for the housing industry. The hope is that the Fed can pull off the tightrope walk of slowing the economy enough to snuff out high inflation, but not so much that it creates a painful recession.

Tuesday’s data casts doubt on hopes for such a “soft landing.” Higher rates also hurt prices for stocks, bonds and other investments.

Investments seen as the most expensive or the riskiest are the ones hardest hit by higher rates. Bitcoin tumbled 9.4%.

Expectations for a more aggressive Fed also helped the dollar add to its already strong gains for this year. The dollar has been surging against other currencies in large part because the Fed has been hiking rates faster and by bigger margins than many other central banks.

The dollar bought 144.59 Japanese yen, up from 144.57 yen late Tuesday. The euro rose to 0.9973 cents, up from 0.9969 cents.

Oil prices rose. U.S. benchmark crude added 38 cents to $87.69 per barrel in electronic trading on the New York Mercantile Exchange. It lost 47 cents to $87.31 on Tuesday. Brent crude, the international pricing standard, climbed 38 cents to $93.55 per barrel.

___

AP Business Writers Stan Choe, Alex Veiga and Damian J. Troise contributed.

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Pelosi praises Taiwan, says Asian trip wasn’t to change status quo

TOKYO, Aug 5 (Reuters) – U.S. House of Representatives Speaker Nancy Pelosi on Friday praised Taiwan, pledged U.S. solidarity and said her trip through Asia, which led to unprecedented military drills by an angry China, was never about changing the regional status quo.

Pelosi and a congressional delegation were in Japan on the last stage of an Asian trip that included a brief and unannounced stop in Taiwan, the self-ruled island that Beijing considers its own – and prompted an infuriated Beijing to hold live-fire drills in waters around Taiwan, with five missiles landing in Japan’s exclusive economic zone(EEZ).

Her stop in Taiwan, the highest-level visit by a U.S. official in 25 years, came as Tokyo, one of Washington’s closest allies, has become increasingly alarmed about China’s growing might in the Indo-Pacific and the possibility that Beijing could take military action against Taiwan.

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“We have said from the start that our representation here is not about changing the status quo in Taiwan or the region,” she told a news conference after meeting with Japanese Prime Minister Fumio Kishida.

“The Chinese government is not pleased that our friendship with Taiwan is a strong one,” she added.

“It is bipartisan in the House and in the Senate, overwhelming support for peace and the status quo in Taiwan.”

China has condemned Pelosi’s trip, which took the delegation to Singapore, Malaysia and South Korea as well as Taiwan and Japan.

Its state broadcaster said the military exercises, which began on Thursday – the day after Pelosi left Taiwan – and are set to end on Sunday, would be the largest conducted by China in the Taiwan Strait. The exercises have involved live fire on the waters and in the airspace around the island.

Japan said that five of nine missiles fired towards its territory landed in its exclusive economic zone (EEZ). Tokyo lodged a diplomatic protest over the incident, which Defence Minister Nobuo Kishi termed “unprecedented.” read more

Pelosi lauded Taiwan’s democracy, economic successes and – in a veiled dig at China – its human rights record, noting support by Taiwan, the first Asian nation to allow same-sex marriage, for LGBTQ rights.

“The fact is, I have said it again and again, if we do not speak out for human rights in China because of commercial interests, we lose all moral authority to speak out about human rights any place in the world,” she said.

“China has some contradictions – some progress in terms of lifting people up, some horrible things happening in terms of the Uyghurs. In fact, it’s been labelled a genocide.”

Human rights groups accuse Beijing of abuse against Xinjiang’s Uyghur ethnic group, accusations China rejects.

WORRIED ALLY, MAINTAINING PEACE

Earlier, Pelosi met with Kishida, who later said they would work together to maintain peace and stability in the Taiwan Strait, a key shipping route.

Japan, whose southernmost islands are closer to Taiwan than Tokyo, has warned that Chinese intimidation of Taiwan is an escalating national security threat. read more

Tensions between Japan and China also ramped up a notch on Thursday when China announced that a meeting between the two nations’ foreign ministers, set to take place on the sidelines of an ASEAN meeting in Cambodia, had been called off due to its displeasure with a G7 statement urging Beijing to resolve the tension over Taiwan peacefully. read more

China summoned the Japanese ambassador in Beijing to lodge stern representations over its participation in the “erroneous” G7 statement, its foreign ministry said on Friday.

While visiting Japan in May, U.S. President Joe Biden said he would be willing to use force to defend Taiwan – a comment that appeared to stretch the limits of the U.S. policy of “strategic ambiguity” towards the island. read more

Kishida’s ruling Liberal Democratic Party (LDP) has also pledged to double military spending to 2% of GDP.

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Additional reporting by Elaine Lies, Mariko Katsumura and Kentaro Sugiyama; writing by Elaine Lies; Editing by David Dolan, Stephen Coates & Simon Cameron-Moore

Our Standards: The Thomson Reuters Trust Principles.

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Asian stocks slide with U.S. yields on Pelosi jitters; Aussie drops

A man wearing a protective face mask, amid the coronavirus disease (COVID-19) pandemic, walks past a screen showing Shanghai Composite index, Nikkei index and Dow Jones Industrial Average outside a brokerage in Tokyo, Japan, February 14, 2022. REUTERS/Kim Kyung-Hoon

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TOKYO, Aug 2 (Reuters) – Asia stocks tumbled on Tuesday as jitters about an escalation in Sino-U.S. tension with U.S. House of Representatives Speaker Nancy Pelosi set to begin a trip to Taiwan, adding to fears about the risk of global recession.

U.S. long-term Treasury yields dropped to a four-month low, pulling the U.S. dollar down, amid a bid for safer assets after China threatened repercussions in the event of the visit by Pelosi to the self-ruled island, which China claims as its territory. Crude oil also sank.

Meanwhile, Australian stocks pared declines and the Aussie dollar weakened after the central bank raised the key rate by an as-expected 50 basis points, with markets interpreting changes to the accompanying policy statement as dovish. read more

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Japan’s Nikkei (.N225) slid 1.54%, while Taiwan’s stock index (.TWII) dropped 1.87%.

Chinese blue chips (.CSI300) tumbled 2.47% and Hong Kong’s Hang Seng (.HSI) lost 2.71%.

However, Australia’s equity benchmark (.AXJO) was just 0.23% lower, after an earlier decline of 0.7%

MSCI’s broadest index of Asia-Pacific shares (.MIAP00000PUS) retreated 1.33%.

U.S. e-mini stock futures pointed to a 0.44% lower restart for the S&P 500 (.SPX), which stumbled 0.28% overnight.

“We knew from the onset that (Pelosi’s trip) would be a driver of risk-off sentiment in the region,” said Carlos Casanova, the senior Asia economist at Union Bancaire Privee in Hong Kong.

“There’s going to be a lot of speculation and uncertainty about what the extent of China’s response will be in the short term.”

The week began with China, Europe and the United States reporting weakening factory activity, with that in the U.S. decelerating to its lowest level since August 2020. read more

That sank crude, with Brent futures edging down to $99.27 a barrel on Tuesday after losing almost $4 overnight. U.S. West Texas Intermediate futures also eased to $93.26, extending Monday’s almost $5 slide.

The benchmark 10-year U.S. Treasury yield fell as low as 2.53% in Tokyo trade, the lowest since April 5, amid wagers the slowdown could spur the U.S. Federal Reserve to ease off the policy-tightening pedal. The bonds also benefited from safety-seeking demand before Pelosi’s Taiwan visit.

That helped the U.S. dollar slide as low as 130.40 yen for the first time since June 6. The euro jumped as high as $1.0294, a level not seen since July 5.

The Taiwan dollar slipped to its lowest level in more than two years on the weaker side of 30 per U.S. dollar.

Meanwhile, the Aussie was 0.51% lower at $0.69910, extending a 0.14% retreat following the Reserve Bank of Australia’s policy decision.

It had hit the highest since June 17, at $0.7048, in the previous session but that was after bouncing off a 26-month trough at $0.66825 in the middle of last month.

“The Aussie has been underperforming other major currencies lately given global growth concerns so it really needed a hawkish surprise to reignite its recovery from 2-year lows,” said Sean Callow, a currency strategist at Westpac in Sydney.

“Instead, it got the RBA leaving the door wide open to slowing the pace of tightening at future meetings, sending AUD back below $0.70.”

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Reporting by Kevin Buckland; Additional reporting by Tom Westbrook; Editing by Robert Birsel

Our Standards: The Thomson Reuters Trust Principles.

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Asian stocks follow Wall Street ahead of likely US rate hike

BEIJING (AP) — Asian stock markets followed Wall Street lower Wednesday as traders prepared for a possible sharp interest rate hike from the Federal Reserve to cool inflation.

Shanghai, Hong Kong and South Korea declined. Tokyo advanced. Oil prices were little changed, staying below $100 per barrel.

Wall Street tumbled Tuesday after Walmart warned inflation that has spiked to a four-decade high of 9.1% is hurting American consumer spending.

The Fed on Wednesday is expected to announce a rate hike of up to three-quarters of a percentage point, triple its usual margin. That would match a similar increase last month, the U.S. central bank’s biggest in 28 years.

Investors worry aggressive action against inflation by the Fed and central banks in Europe and Asia might derail global economic growth.

“The main risk at this stage is in fact an inflation ‘overkill’ with monetary tightening too abrupt, unnecessarily pushing up the unemployment rate,” said Thomas Costerg of Pictet Wealth Management in a report. Thomas said most economic indicators and lower commodity prices already point to slower inflation ahead.

The Shanghai Composite Index lost 0.1% to 3,273.32 while Tokyo’s Nikkei 225 advanced 0.1% to 27,692.89. The Hang Seng in Hong Kong sank 1.5% to 20,598.58.

The Kospi in Seoul retreated 0.6% to 2,398.48 and Sydney’s S&P-ASX 200 shed 0.1% to 6,798.20.

New Zealand advanced while Southeast Asian markets declined.

On Wall Street, the benchmark S&P 500 index fell 1.2% to 3,921.05. The Dow Jones Industrial Average dropped 0.7% to 31,761.54. The Nasdaq composite closed 1.9% lower at 11,562.57.

Walmart slumped 7.6% after the retail giant cut its profit outlook for the second quarter and the full year late Tuesday. It said rising prices for food and gasoline are forcing shoppers to cut back on more profitable discretionary items, particularly clothing.

The retailer’s profit warning in the middle of the quarter is rare and raised worries about how the highest inflation in 40 years is affecting the entire retail sector.

Other major chains also fell. Target dropped 3.6%, Macy’s slid 7.2% and Kohl’s fell 9.1%.

Tech stocks retreated. Microsoft fell 2.7%, Amazon slid 5.2% and Facebook owner Meta Platforms dropped 4.5%.

General Motors fell 3.4% after its second-quarter profit fell 40% from a year ago. U.S. sales fell 15% after shortages of processor chips and other components left the company unable to deliver 95,000 vehicles during the quarter.

In energy markets, benchmark U.S. crude rose 30 cents to $95.28 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.72 on Tuesday to $94.98. Brent crude, the price basis for international oils, added 5 cents to $99.51 per barrel in London.

The dollar rose to 136.97 yen from Tuesday’s 136.00 yen. The euro gained to $1.0145 from $1.0120.

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