Asian Markets Track Global Markets Lower

Asian stock markets are trading mostly lower on Monday, following the broadly negative cues from global markets on Friday, as the unexpected spike in US core consumer prices added to recent concerns about the outlook for interest rates as the US Federal Reserve may be inclined to leave interest rates higher for longer. Asian markets closed mixed on Friday.

Paul Ashworth, Chief North America Economist at Capital Economics, called the data “another sign that the Fed might have to leave its policy rate higher for longer.”

The Australian stock market is sharply lower on Monday, giving up the gains in the previous session, with the benchmark S&P/ASX 200 falling to nearly the 7,200 level, following the broadly negative cues from global markets on Friday, with weakness across most sectors, led by miners and technology stocks.

The benchmark S&P/ASX 200 Index is losing 89.60 points or 1.23 percent to 7,217.40, after hitting a low of 7,193.40 earlier. The broader All Ordinaries Index is down 99.80 points or 1.33 percent to 7,412.90. Australian stocks closed modestly higher on Friday.

Among the major miners, Rio Tinto and Fortescue Metals are losing almost 3 percent each, while BHP Group is declining more than 3 percent and ineral Resources is sliding 5.5 percent. nd OZ Minerals is flat.

Oil stocks are mostly lower. Santos is declining more than 2 percent and Beach energy is losing almost 1 percent, while Origin Energy is adding almost 1 percent. Woodside Energy is edging up 0.5 percent after reporting that full-year net profit more than trebled.

Among tech stocks, Afterpay owner Block and Xero are losing more than 2 percent each, while WiseTech Global is declining more than 3 percent each, Zip is slipping almost 3 percent and Appen is plummeting more than 14 percent after reporting a loss for fiscal 2022 and flaging a weal fiscal 2023. It also scrapped dividend.

Gold miners are lower. Northern Star Resources and Evolution Mining are losing almost 1 percent each, while Gold Road Resources is declining almost 3 percent and Resolute Mining is slipping more than 4 percent. Newcrest Mining is edging up 0.2 percent.

Among the big four banks, Commonwealth Bank and ANZ Banking are edging down 0.1 0.2 percent each, while Westpac is edging up 0.1 percent. National Australia Bank is flat.

In other news, shares in Downer EDI are plummeting 18 percent after the engineering firm reported a 21 percent drop in half-year net profit. It also cup full-year profit guidance and confirmed it overstated earnings in the previous three financial years.

In economic news, Australia’s company gross operating profits surged a seasonally adjusted 10.6 percent on quarter in the fourth quarter of 2022, the Australian Bureau of Statistics said on Monday. That blew away expectations for an increase of 1.5 percent following the upwardly revised 11.5 percent decline in the three months prior (originally -12.5 percent). On a yearly basis, operating profits jumped16.0 percent, inventories gained 5.9 percent and wages advanced 11.6 percent.

In the currency market, the Aussie dollar is trading at $0.672 on Monday.

The Japanese stock market is slightly lower on Monday, giving up the gains in the previous session, with the Nikkei 225 staying above the 27,400 level, following the broadly negative cues from global markets on Friday, dragged by technology stocks as traders remain cautious ahead of Bank of Japan governor nominee Kazuo Ueda’s appearance before the upper house.

The benchmark Nikkei 225 Index closed the morning session at 27,405.37, down 48.11 or 0.18 percent, after hitting a low of 27,292.74 earlier. Japanese shares ended sharply higher on Friday.

Market heavyweight SoftBank Group is losing almost 2 percent, while Uniqlo operator Fast Retailing is edging up 0.2 percent. Among automakers, Honda is gaining more than 1 percent, while Toyota is edging up 0.1 percent.

In the tech space, Screen Holdings is edging up 0.2 percent, while Advantest is losing more than 1 percent and Tokyo Electron is slipping 1.5 percent. In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are gaining almost 1 percent each, while Mizuho Financial is adding more than 1 percent.

The major exporters are mostly lower. Canon and Panasonic are gaining more than 1 percent each, while Mitsubishi Electric is adding 1.5 percent and Sony is edging up 0.4 percent.

Among the other major gainers, Konami Group is losing almost 4 percent and Ajinomoto is down almost 3 percent.

Conversely, Kobe Steel is gaining almost 4 percent, while Nikon and Mitsubishi Motors are adding more than 3 percent each. Toppan, Tokai Carbon, JFE Holdings, Obayashi, Ebara, Nippon Steel and Mitsui Chemicals are adding almost 3 percent each.

In the currency market, the U.S. dollar is trading in the lower 136 yen-range on Monday.

Elsewhere in Asia, New Zealand is down 1.3 percent, while Singapore, South Korea Malaysia and Indonesia are lower by between 0.2 and 0.9 percent each. China and Hong Kong are up 0.3 and 0.1 percent, respectively. Taiwan is closed for Peace Memorial Day holiday.

On Wall Street, stocks moved sharply lower in early trading on Friday and remained firmly negative throughout the session. With the steep drop on the day, the Dow fell to a two-month closing low, while the S&P 500 dropped to its lowest closing level in over a month.

The major averages all posted steep losses on the day. The Dow slumped 336.99 points or 1.0 percent to 32,816.92, the Nasdaq plunged 195.46 points or 1.7 percent to 11,394.94 and the S&P 500 tumbled 42.28 points or 1.1 percent to 3,970.04.

The major European markets all also moved to the downside on the day. While the U.K.’s FTSE 100 Index fell by 0.4 percent, the German DAX Index and the French CAC 40 Index plunged by 1.7 percent and 1.8 percent, respectively.

Crude oil futures showed a big turnaround over the course of the trading day on Friday after coming under pressure early in the session. West Texas Intermediate crude for April delivery jumped $0.93 or 1.2 percent to $76.32 after falling as low as $74.09 a barrel in early trading.

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