Asian Markets Track Wall Street Lower

Asian stock markets are trading mostly lower on Monday, following the broadly negative cues from Wall Street on Friday, as traders are cautious after data showed a drop in U.S. consumer sentiment amid signs of growing stress in the banking sector and the impasse over raising the U.S. debt ceiling. Asian markets closed mostly lower on Friday.

U.S. Treasury Secretary Janet Yellen has warned that a default on the U.S. debt would be catastrophic and was “unthinkable.” The postponement of a meeting between President Joe Biden and top lawmakers adding to jitters about a potential default.

The Australian stock market is modestly lower on Monday, giving up the slight gains in the previous session, with the benchmark S&P/ASX 200 staying above the 7,200 level, following the broadly negative cues from Wall Street on Friday, with weakness in technology and financial stocks partially offset by gains in miners and energy stocks.

The benchmark S&P/ASX 200 Index is losing 11.70 points or 0.16 percent to 7,245.00, after hitting a low of 7,235.10 earlier. The broader All Ordinaries Index is down 17.20 points or 0.23 percent to 7,436.00. Australian stocks closed slightly higher on Friday.

Among the major miners, Rio Tinto and Fortescue Metals are gaining almost 1 percent each, while BHP Group is adding more than 1 percent. Mineral Resources is losing more than 1 percent.

Oil stocks are mostly higher. Woodside Energy is gaining almost 1 percent, while Santos and Origin Energy are edging up 0.2 to 0.3 percent each. Beach energy is edging down 0.2 percent.

Among tech stocks, Xero and WiseTech Global are edging down 0.4 to 0.5 percent each, while Zip is losing almost 3 percent. Appen is gaining more than 2 percent and Afterpay owner Block is flat.

Gold miners are higher. Gold Road Resources and Northern Star Resources are gaining more than 2 percent each, while Evolution Mining and Resolute Mining are adding more than 1 percent each. Newcrest Mining is up almost 1 percent after its board unanimously agreed to back US gold giant Newmont’s takeover offer.

Among the big four banks, Commonwealth Bank is losing almost 1 percent, while Westpac is edging down 0.3 percent and ANZ Banking is down almost 1 percent. National Australia Bank is flat.

In other news, shares in InvoCare are surging more than 10 percent after it received a revised takeover offer from TPG Capital.

In the currency market, the Aussie dollar is trading at $0.666 on Monday.

The Japanese stock market is notably higher on Monday, extending the gains in the previous two sessions, with the Nikkei 225 moving above the 29,500 level at 18-month highs, despite the broadly negative cues from Wall Street on Friday, as traders cheered some upbeat domestic earnings and data that showed April producer prices in Japan rose the least in 20 months.

The benchmark Nikkei 225 Index closed the morning session at 29,507.03, up 118.73 or 0.40 percent, after touching a high of 29,629.47 earlier. Japanese shares ended significantly higher on Friday.

Market heavyweight SoftBank Group is edging up 0.5 percent and Uniqlo operator Fast Retailing is gaining almost 1 percent. Among automakers, Honda is edging up 0.4 percent, while Toyota is losing almost 1 percent.

In the tech space, Screen Holdings and Advantest are edging down 0.3 to 0.4 percent each, while Tokyo Electron is losing almost 2 percent.

In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are gaining more than 1 percent each, while Mizuho Financial is edging up 0.5 percent.

The major exporters are higher. Canon is edging up 0.1 percent, while Panasonic and Sony are gaining almost 1 percent each. Mitsubishi Electric is losing almost 1 percent.

Among the other major gainers, NSK is skyrocketing more than 12 percent, Nippon Sheet Glass is soaring almost 7 percent and Mitsubishi Materials is surging more than 6 percent, while Shiseido, Secom and Rakuten Group are gaining more than 4 percent each. Ajinomoto, UBE, Amada and Nippon Telegraph & Telephone are adding almost 4 percent each, while Shizuoka Financial, Daiwa House Industry, KDDI, Asahi Group and Otsuka Holdings are up almost 3 percent each.

Conversely, Olympus is plunging more than 8 percent and Sumitomo Heavy Industries slipping almost 6 percent, while Nissan Motor and Sumitomo Electric are losing almost 4 percent each. Kubota, Resona Holdings and Japan Steel Works are losing more than 3 percent each, while Nippon Express, Sumitomo Realty & Development and NTN are down almost 3 percent each.

In economic news, producer prices in Japan were up 5.8 percent on year in April, the Bank of Japan said on Monday – shy of expectations for an increase of 7.1 percent and down from the upwardly revised 7.4 percent jump in March (originally 7.2 percent). On a monthly basis, producer prices rose 0.2 percent versus expectations for a gain of 0.1 percent following the upwardly revised 0.1 percent increase in the previous month (originally -0.3 percent).

In the currency market, the U.S. dollar is trading in the higher 135 yen-range on Monday.

Elsewhere in Asia, New Zealand, China, Singapore, South Korea, Malaysia and Taiwan are lower by between 0.1 and 0.7 percent each. Indonesia is bucking the trend and is up 0.1 percent. Hong Kong is relatively flat.

On Wall Street, stocks showed a notable recovery attempt in the latter part of the session gollowing the downturn seen in morning trading on Friday. The major averages climbed well off their worst levels of the day but still closed in the red.

The tech-heavy Nasdaq fell 43.76 points or 0.4 percent to 12,284.74 and the S&P 500 dipped 6.54 points or 0.2 percent to 4,124.08, while the Dow edged down just 8.89 points or less than a tenth of a percent to 33,300.62.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.’s FTSE 100 Index rose by 0.3 percent, the French CAC 40 Index and the German DAX Index both climbed by 0.5 percent.

Crude oil prices fell Friday on the dollar’s strength and worries about the outlook for energy demand. Fears of the U.S. falling into a recession and the impasse in debt ceiling talks boosted dollar’s safe-haven appeal and hurt oil prices. West Texas Intermediate Crude oil futures fell $0.83 or 1.2 percent at $70.04 a barrel.

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