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Asian Markets Mostly Lower

asiancommentary dec27 17jan21 lt

Asian stock markets are mostly lower on Monday, tracking the weak cues from Wall Street Friday that reflected a negative reaction to earnings results from major banks and weak U.S. retail sales data.

Worries about U.S.-China tensions also weighed on the markets after Reuters reported, citing people familiar with the matter, that the Trump administration has notified Chinese telecom giant Huawei's suppliers, including chipmaker Intel, that certain licenses to sell to the Chinese company will be revoked.

The Australian market is declining following the weak cues from Wall Street Friday. Investor sentiment was also dampened following comments by Brendan Murphy, the head of Australia's health department, that it was unlikely international borders would be substantially reopened this year even if most people received the coronavirus vaccine.

The benchmark S&P/ASX 200 Index is lower by 43.10 points or 0.64 percent to 6,672.30, after falling to a low of 6,661.20 The broader All Ordinaries Index is down 41.90 points or 0.60 percent to 6,944.90. Australian markets ended little changed on Friday with a positive bias.

Among the major miners, BHP Group is losing almost 3 percent, Rio Tinto is lower by more than 2 percent and Fortescue Metals is down almost 1 percent ahead of their quarterly production results.

Oil stocks are also weak after crude oil prices fell on Friday amid worries about energy demand. Oil Search is tumbling almost 3 percent, Woodside Petroleum is declining more than 2 percent, and Santos is lower by almost 2 percent.

In the banking sector, National Australia Bank and ANZ Banking are lower by more than 1 percent each, while Commonwealth Bank is declining almost 1 percent and Westpac is down 0.5 percent.

Gold miners are mixed after gold prices drifted lower on Friday. Newcrest Mining is lower by more than 1 percent, while Evolution Mining is edging up 0.1 percent.

Tech stocks are mostly higher. WiseTech Global is rising more than 2 percent and Appen is advancing more than 1 percent, while Afterpay is down 0.3 percent.

JB Hi-Fi, which owns the whitegoods chain The Good Gury, said preliminary figures indicated an 86 percent surge in net profit after tax for the first half of the year. Shares of the retail group are rising more than 3 percent.

Super Retail Group, which owns Macpac, BCF and Supercheap Auto, said it expects its net profit after tax for the first half to rise by up to 201 percent. The company's shares are advancing more than 1 percent.

The Japanese market is losing after U.S. stocks closed lower on Friday and as investors booked profits after recent strong gains.

The benchmark Nikkei 225 Index is declining 250.49 points or 0.88 percent to 28,268.69, after touching a low of 28,111.54 in early trades. Japanese shares fell on Friday from the 30-year high hit the previous day.

Market heavyweight SoftBank Group is edging down 0.1 percent and Fast Retailing is declining 0.7 percent. In the tech space, Advantest is lower by more than 1 percent and Tokyo Electron is down 0.7 percent.

The major exporters are mostly lower despite a slightly weaker yen. Canon is losing more than 2 percent, while Mitsubishi Electric and Sony are declining almost 1 percent each. Panasonic is advancing almost 2 percent.

In the banking sector, Sumitomo Mitsui Financial is losing more than 1 percent and Mitsubishi UFJ Financial is lower by almost 1 percent. Among automakers, Honda is down 1 percent and Toyota is lower by almost 1 percent.

Among the other major gainers, Denso Corp. is rising more than 2 percent and Cyberagent is higher by almost 2 percent.

Conversely, Isetan Mitsukoshi is losing more than 5 percent, while Nikon and JGC Holdings are lower by more than 4 percent each. Mitsui OSK Lines is declining almost 4 percent.

In economic news, Japan will see final November numbers for industrial production today.

In the currency market, the U.S. dollar is trading in the upper 103 yen-range on Monday.

Elsewhere in Asia, South Korea, Singapore, New Zealand, Malaysia and Taiwan are also lower, while Shanghai, Indonesia and Hong Kong are higher.

On Wall Street, stocks closed lower on Friday, partly reflecting a negative reaction to earnings news from financial giants Wells Fargo, Citigroup and JPMorgan Chase. Negative sentiment was also generated in reaction to a report from the Commerce Department showing a continued decline in U.S. retail sales in the month of December.

The Dow ended the day down 117.26 points or 0.6 percent at 30,814.26 after tumbling by nearly 380 points in early trading. The Nasdaq slumped 114.14 points or 0.9 percent to 12,998.50 and the S&P 500 slid 27.29 points or 0.7 percent to 3,768.25.

The major European markets showed significant moves to the downside on Friday. While the U.K.'s FTSE 100 Index slumped by 1 percent, the French CAC 40 Index and the German DAX Index tumbled by 1.2 percent and 1.4 percent, respectively.

Crude oil futures settled sharply lower on Friday as worries about energy demand resurfaced amid rising coronavirus cases and tighter restrictions on movements in several countries, including China. Crude for February delivery tumbled $1.21 or about 2.3 percent to $52.36 a barrel.

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