Asian markets edge lower after rally

Equities unwinding the “reduced operations” rally

Equity markets spent most of last night unwinding the Russian “reduced operations” knee jerk rally, as even the most ardent FOMO bull came to realise the statement didn’t amount to much. Going forward, we can still expect more of these “peace in our time” knee jerk rallies at the slightest hint of progress in peace talks, no matter how tenuous the reasoning.

The S&P 500 fell by 0.63%, the Nasdaq slumped by 1.21%, while the Dow Jones eased by 0.19%. Some short covering is evident in US futures today, perhaps assisted by lower oil prices. Nasdaq futures are 0.35% higher, with S&P futures gaining 0.10% while Dow futures are flat.

Asian markets have ignored lower oil prices today, perhaps, rightly in my opinion, regarding the falls as temporary. Weaker data from Japan and China is weighing slightly, but overall, it appears Asian markets are following the US and Europe and correcting the knee jerk rally of yesterday. The Nikkei 225 is down 0.65%, but the Kospi has edged 0.40% higher after its data outperformed. Mainland China is lower with the Shanghai Composite down 0.35% and the CSI 300 falling by 0.65%. Hong Kong has retreated by 1.50%.

In regional markets, Singapore is 0.45% lower, Taipei is down 0.25%. Jakarta and Kuala Lumpur are bucking the trend, rising 0.25% despite lower oil prices. The Sensex is unchanged in early trading, while Bangkok is down 0.10%. Australian markets are modestly lower, the ASX 200 and All Ordinaries easing by 0.15%.

Overall, the mixed data picture in Asia has been offset to some extent by lower oil prices. European markets will take some heart from lower oil as well and especially the news that Russia will allow gas payments in euros to continue for now.

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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