After a brief respite yesterday when European markets rebounded strongly and US stocks remained static, Asian shares returned to full retreat mode last night and fell to four-year lows in some markets.
The Nikkei in Japan and the Hang Seng in Hong Kong were both down by more than 3% while the CSI in China fell by 1.5%.
The MSCI's broadest index of Asia-Pacific shares outside Japan was at its lowest level since late 2011.
Oil
The principal trigger remains concerns over oil prices. The International Energy Agency (IEA) warned yesterday evening that with Iran re-entering the market, the world could “drown in oil” and that over-supply could amount to more than 1 million barrels per day.
“While the pace of stockbuilding eases in the second half of the year as supply from non-Opec producers falls, unless something changes, the oil market could drown in oversupply,” the IEA said as Iran returns to the market.
Brent crude oil hit a 13-year low of less than $28 per barrel on Monday.
Results
Meanwhile, sentiment on Western markets won’t be improved today as another US corporate giant failed to impress investors with fourth-quarter results last night.
The share price of IBM, fell 3% in after hour’s trading last night after reporting a 8.5% fall in revenues for the three months to December and a 2016 earnings forecast of $13.50 per share, that was about $1.50 below most expectations.
