Ukraine jitters weigh on Asian markets

Asian equities spooked by Ukraine nuclear plant fire

Overnight, European stock markets were crushed once again under Ukrainian nerves as commodity prices across the board soared. US stocks managed a modest recovery as bond yields steadied and hopes rose of an Iranian nuclear deal. But Wall Street still finished lower on the day, notably in the tech space. The S&P 500 fell by 0.43%, the Nasdaq dropped by 1.44%, and the Dow Jones edged 0.28% lower.

US futures, and the rest of Asia, have dropped this morning on the Ukraine nuclear power station fire situation, with all three indexes down around 0.80%. The contagion has spilt into the Nikkei 225, which has tumbled by 2.30%, while the Kospi has fallen by 1.15%.

In mainland China, the Shanghai Composite is 0.40% lower, while the CSI 300 has dropped by 0.65%. Hong Kong is in full retreat, complicated by their rapidly deteriorating Covid-19 situation and the weighting of China tech heavyweights, the Hang Seng has tumbled by 2.50%.

Regional Asia sees Singapore down 0.50% and Taipei down 0.80%. Commodity-heavy Jakarta, returning from holiday, has bucked the trend and risen by 0.80%, but Kuala Lumpur is 1.20% lower. Bangkok is down 0.90% and Manila by 0.40%. Australian markets are following sentiment and not commodity prices this morning, the ASX 200 and All Ordinaries retreating by 0.85%.

The Zaporizhzhia situation, despite the reactors being intact and the fire actually being outside of the perimeter, has opened a new thread of risk around the Russia-Ukraine conflict. It is likely to unnerve European markets meaning that the downward spiral seen yesterday is likely to continue this afternoon. US markets, conversely, remain at the mercy of fast-money flows trading headlines.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley is OANDA’s senior market analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV, Channel News Asia as well as in leading print publications including the New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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