Asian Markets Show Mixed Trend

asiancommentary dec03 10jan22 lt

Asian stock markets are trading mixed on Tuesday, following the mixed cues from Wall Street overnight, amid a drop in crude oil prices and as traders remain concerned and cautious over the surging cases of the coronavirus Omicron variant in several countries, including the U.S., and its impact on the global economy. Asian stocks ended mixed on Monday.

Traders are now looking ahead to key inflation data as well as a Senate Banking Committee hearing on US Federal Reserve Chair Jerome Powell's renomination later in the week for additional clues about the U.S. central bank's stance about rate hikes.

The Australian stock market is trading notably lower on Tuesday, extending the slight losses in the previous session, with the benchmark S&P/ASX 200 staying just above the 7,400 level, following the mixed cues from Wall Street overnight, as traders remain concerned over the rapid rise in domestic Covid-19 cases, with the tally of infections surpassing 1 million on Monday, and its impact on the economy. Materials and energy stocks are down on weak commodity prices.

New South Wales reported 25,870 new cases and 11 deaths on Monday and Victoria also reported 37,994 new cases and 13 deaths. Queensland recorded 20,566 new cases and Tasmania reported 1,379 new cases.

The benchmark S&P/ASX 200 Index is losing 28.30 points or 0.38 percent to 7,418.80, after hitting a low of 7,376.80 earlier. The broader All Ordinaries Index is down 25.30 points or 0.33 percent to 7,740.80. Australian stocks closed slightly lower on Friday.

Among the major miners, OZ Minerals is losing almost 2 percent and Rio Tinto is edging down 0.5 percent, while BHP Group and Mineral Resources are down almost 1 percent each. Fortescue Metals is gaining more than 1 percent.

Oil stocks are mostly lower. Woodside Petroleum is losing almost 1 percent, Santos is declining almost 2 percent and Origin Energy is down more than 1 percent, while Beach energy is edging up 0.4 percent.

Among the big four banks, National Australia Bank and ANZ Banking are losing more than 1 percent each, while Commonwealth Bank is declining almost 2 percent and Westpac is edging down 0.5 percent.

Among tech stocks, Xero and Zip are adding almost 1 percent each, while Appen is edging up 0.2 percent and Afterpay is gaining almost 2 percent. WiseTech Global is flat.

Gold miners are higher. Resolute Mining is gaining more than 2 percent, Gold Road Resources is adding more than 1 percent, Northern Star Resources is up almost 2 percent, Evolution Mining advancing almost 3 percent and Newcrest Mining is rising almost 1 percent.

In economic news, the value of retail sales in Australia was up a seasonally adjusted 7.3 percent on month in November, the Australian Bureau of Statistics said on Tuesday - coming in at A$33.411 billion. That beat expectations for an increase of 3.9 percent and was up from 4.9 percent in October.

Meanwhile, November had a merchandise trade surplus of A$9.423 billion in November, the Australian Bureau of Statistics said on Tuesday. That was shy of expectations for a surplus of A$10.6 billion and down from the downwardly revised A$10.781 billion surplus in October (originally A$11.22 billion).

Goods and services credits (exports) rose A$691 million or 2 percent to A$43.859 billion, driven by a rise in exports of rural goods. Goods and services debits (imports) rose A$2.049 billion (6 percent) to A$34.436 billion, driven by a rise in imports of primary industrial supplies.

In the currency market, the Aussie dollar is trading at $0.719 on Tuesday.

The Japanese stock market is significantly lower on opening after a holiday on Tuesday, extending the losses in the previous two sessions, with the benchmark Nikkei index staying below the 28,200 level, following the mixed cues from Wall Street overnight, as Japan plans to maintain its strict border restrictions until late February in a bid to stave off the rapid spread of the omicron coronavirus variant.

The benchmark Nikkei 225 Index closed the morning session at 28,231.31, down 247.25 points or 0.87 percent, after hitting a low of 28,089.49 earlier. Japanese shares closed slightly lower on Friday.

Market heavyweight SoftBank Group is losing 2.5 percent and Uniqlo operator Fast Retailing is down almost 2 percent. Among automakers, Honda is gaining almost 1 percent, while Toyota is edging down 0.3 percent.

In the tech space, Advantest is losing almost 2 percent, Screen Holdings is down more than 1 percent and Tokyo Electron is declining more than 2 percent. In the banking sector, Mitsubishi UFJ Financial is edging up 0.3 percent, Sumitomo Mitsui Financial is up more than 1 percent and Mizuho Financial is gaining almost 1 percent.

The major exporters are mostly lower. Panasonic is losing more than 2 percent, Mitsubishi Electric is edging down 0.5 percent and Sony is declining almost 1 percent, while Canon is edging up 0.3 percent.

Among the other major losers, Keyence is plunging more than 7 percent and Shiseido is losing 5.5 percent, while Taiyo Yuden and Kikkoman are down almost 4 percent each. Nippon Express is declining more than 3 percent, while Yamato Holdings, Z Holdings, Dentsu Group, Rakuten Group and Yamaha Motor are all slipping almost 3 percent each.

Conversely, Mitsubishi Heavy Industries is gaining more than 4 percent.

In the currency market, the U.S. dollar is trading in the lower 115 yen-range on Tuesday.

Elsewhere in Asia, China, Hong Kong, Singapore and Indonesia are higher by between 0.1 and 0.3 percent each, while New Zealand, South Korea, Malaysia and Taiwan are lower by between 0.1 and 0.5 percent each.

On Wall Street, stocks showed a notable rebound over the course of the trading session on Monday following an early sell-off. The major averages climbed well off their worst levels of the day, with the Nasdaq reaching positive territory.

The Nasdaq tumbled by as much as 2.7 percent in early trading but ended the day up 6.93 points or 0.1 percent at 14,942.83. Meanwhile, the S&P 500 edged down 6.74 points or 0.1 percent at 4,670.29 and the Dow fell 162.79 points or 0.5 percent at 36,068.87.

Meanwhile, the major European markets all moved to the downside on the day. While the U.K.'s FTSE 100 Index fell by 0.5 percent, the German DAX Index tumbled by 1.1 and the French CAC 40 Index plunged by 1.4 percent.

Crude oil prices drifted lower Monday on concerns about the outlook for energy demand due to the rapid surge in the Omicron variant of the coronavirus across the globe. A firm dollar amid rising prospects for a series of interest rate hikes weighed as well on crude oil prices. West Texas Intermediate Crude futures for February slipped $0.67 or 0.9 percent at $78.23 a barrel.

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