Last week’s Paris terrorist attack continues to haunt the financial markets. Asian shares fell on Wednesday as copper prices tumbled and another bomb scare in Europe and gunfire in the French capital dampened risk appetite. Chances of the Federal Reserve rate hike remaining on target buttressed the dollar.
Wall Street shares gave up earlier gains to end almost flat following news that German authorities had called off the soccer match which German Chancellor Angel Merkel was due to attend.
The dollar edged lower late in the Asian day after hitting a new seven-month high against a basket of currencies earlier in the session as U.S. economic data reinforced expectations that the Fed will increase interest rates next month for the first time in nearly a decade.
In China, the yuan fell against the strong dollar at the close of Wednesday's trading session, hovering at 6.3840 while the Shanghai composite fell by close to one percent and the smaller Shenzhen composite posted even bigger losses, ending near a 2 percent decline. The Chinext composite and the CSI 300 index also registered substantial declines at market close.
The euro slid on expectations for more monetary easing by the European Central Bank in December.
Commodities Suffer
Commodities continue to struggle. Copper dropped 1 percent to $4,637.50 a ton after hitting a 6-1/2-year low of $4,590 overnight, amid fears of declining demand from China and MSCI's broadest index of Asia-Pacific shares outside Japan slipped about 0.2 percent.
Gold fell to near six year low overnight ending the session hovering near $1,067 in Asian trade, while oil prices were up on Wednesday following reports of diminishing stockpiles and rising refinery activity. Analysts are still forecasting that the market will remain under pressure for the rest of the year and into 2016.