Asian Markets Follow Wall Street Lower
Asian stock markets are trading mostly lower on Friday, following the broadly negative cues overnight from Wall Street, as some traders continued to cash in on recent strength in the markets. Worries about growth due to the ongoing war in Ukraine, and fears of aggressive monetary tightening by the Federal Reserve and other central banks also rendered the mood cautious. Asian markets ended mostly lower on Thursday.
Crude oil prices also tumbled following reports that the Biden administration is considering a massive release of strategic oil reserves.
Traders are also looking ahead of the release of the U.S. Labor Department’s closely watched monthly employment report later in the day. The jobs data could impact expectations regarding how quickly the Federal Reserve plans to raise interest rates in the months ahead.
The Australian stock market is slightly higher on Friday, recouping some of the losses in the previous session, with the benchmark S&P/ASX 200 moving above the 7,500 level, despite the broadly negative cues overnight from Wall Street, with markets paring early losses after data released showed that manufacturing sector in Australia continued to expand in March at a faster rate. Miners advanced on stronger metals prices.
The benchmark S&P/ASX 200 Index is gaining 4.20 points or 0.06 percent to 7,503.80, after touching a high of 7,512.30 and hitting a low of 7,476.70 earlier. The broader All Ordinaries Index is up 4.40 points or 0.06 percent to 7,794.00. Australian markets ended slightly lower on Thursday.
Among major miners, Rio Tinto, BHP Group and Mineral Resources are gaining almost 1 percent each, while Fortescue Metals is adding more than 1 percent. OZ Minerals is edging down 0.3 percent.
Oil stocks are higher. Woodside Petroleum is edging up 0.2 percent and Origin Energy is gaining more than 1 percent, while Origin Energy and Santos are gaining almost 1 percent each. Beach energy is flat.
Among tech stocks, WiseTech Global is edging down 0.3 percent, Zip is slipping 1.5 percent, Afterpay owner Block is losing more than 3 percent and Xero is down almost 1 percent, while Appen is edging up 0.1 percent.
Among the big four banks, Westpac, ANZ Banking and Commonwealth Bank are losing almost 1 percent each, while National Australia Bank is flat.
Gold miners are mixed. Evolution Mining is edging down 0.5 percent and Northern Star Resources is losing more than 1 percent, while Newcrest Mining is adding more than 1 percent and Resolute Mining is gaining more than 3 percent. Gold Road Resources is flat.
In other news, shares in Cann Group soared almost 9 percent after the cannabis producer gained regulatory approval in the UK, with Satipharm being approved to sell products in the UK.
Melbourne biotech Starpharma is gaining 5.5 percent after it got approval from the British medicines regulator to put back its Viraleze COVID nasal spray back on shelves in the UK. The product was pulled off the shelves from British pharmacy operator Lloyds last July.
In economic news, the manufacturing sector in Australia continued to expand in March, and at a faster rate, the latest survey from S&P Global showed on Friday with a manufacturing PMI score of 57.7. That’s up from 57.0 in February and it moves further above the boom-or-bust line of 50 that separates expansion from contraction. This marked the twenty-second consecutive month in which the sector has grown.
Meanwhile, the Australian Bureau of Statistics said on Friday that the total value of owner-occupied home loans in Australia was down a seasonally adjusted 4.7 percent on month in February, coming in at A$21.53 billion. That missed forecasts for an increase of 1.0 percent, which would have been unchanged from the previous month. Investment lending was down 1.8 percent on month to A$10.75 billion, so overall home loans sank 3.7 percent on month to A$32.28 billion. On a yearly basis, owner-occupied home loans dipped 1.0 percent, investment lending surged 55.8 percent and overall lending climbed 12.6 percent.
In the currency market, the Aussie dollar is trading at $0.748 on Friday.
The Japanese stock market is significantly lower on Friday, extending the losses in the previous two sessions, with the benchmark Nikkei 225 staying above the 27,600 level, as the markets follow the broadly negative cues overnight from Wall Street, with losses across most sectors partially offset by gains in financial stocks.
The benchmark Nikkei 225 Index closed the morning session at 27,618.27, down 203.16 points or 0.73 percent, after hitting a low of 27,399.48 earlier. Japanese shares closed significantly lower on Thursday.
Market heavyweight SoftBank Group is losing almost 1 percent and Uniqlo operator Fast Retailing is declining almost 2 percent. Among automakers, Honda is down almost 2 percent and Toyota is slipping almost 1 percent.
In the tech space, Advantest is sliding almost 3 percent, Screen Holdings is losing almost 2 percent and Tokyo Electron is down 2.5 percent.
In the banking sector, Mizuho Financial and Sumitomo Mitsui Financial are edging up 0.2 percent each, while Mitsubishi UFJ Financial is gaining more than 1 percent.
Among major exporters, Sony, Panasonic and Canon are declining more than 1 percent each, while Mitsubishi Electric is losing almost 1 percent.
Among the other major losers, Nippon Yusen K.K. is plunging more than 7 percent and Mitsui O.S.K. Lines is slipping almost 7 percent, while Citizen Watch and Kawasaki Kisen Kaisha are losing almost 6 percent each. Shionogi & Co. and Mitsui E&S Holdings are sliding more than 4 percent each, while Nippon Express is losing almost 4 percent. Dentsu Group and Idemitsu Kosan are down more tha 3 percent. Yaskawa Electric and Kobe Steel are declining almost 3 percent each.
Conversely, Konami Holdings is gaining almost 5 percent and JGC Holdings is adding almost 3 percent, Nintendo and DeNA are up more than 2 percent each.
In economic news, large manufacturing in Japan weakened in the first quarter of 2022, the Bank of Japan’s quarterly Tankan Survey of business sentiment showed on Friday with a diffusion index score of +14. That beat forecasts for a reading of +12 and was down from +18 three months ago. The outlook came in at +9, missing expectations for +10 and down from +13 in the previous quarter. Large all industry capex is now seen higher by 2.2 percent, missing forecasts for a gain of 5.0 percent and down from 9.3 percent in the previous three months. The large non-manufacturers index came in at +9, beating forecasts for +5 and unchanged from the previous month. The outlook was +7, missing forecasts for +8, which would have been unchanged.
In the currency market, the U.S. dollar is trading in the higher 122 yen-range on Friday.
Elsewhere in Asia, New Zealand, Indonesia, Hong Kong, South Korea and Taiwan are lower by between 0.2 and 0.9 percent each, while China and Malaysia are up 0.6 and 0.5 percent, respectively. Singapore is relatively flat.
On Wall Street, stocks saw moderate weakness for much of the trading session on Thursday before accelerating to the downside going into the close. The major averages all moved sharply lower, extending the pullback seen in the previous session.
The major averages ended the session at their worst levels of the day. The Dow plunged 550.46 points or 1.6 percent at 34,678.35, the Nasdaq tumbled 221.76 points or 1.5 percent to 14,220.52 and the S&P 500 slumped 72.04 points or 1.6 percent to 4,530.41.
The major European markets also moved to the downside on the day. While the U.K.’s FTSE 100 Index declined by 0.8 percent, the French CAC 40 Index and the German DAX Index slumped by 1.2 percent and 1.3 percent, respectively
Crude oil prices drifted plummeted on Thursday after U.S. President Joe Biden authorized the release of 1 million barrels of oil per day from the nation’s Strategic Petroleum Reserve for the next six months. West Texas International Crude oil futures for May ended lower by $7.54 or 7 percent at $100.28 a barrel, the lowest close since March 16.
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