Asian equities ease with Wall Street

Asian markets edge lower

A surprisingly robust US Durable Goods number prompted a few doubts around the lower terminal Fed Funds rate so buy equities strategy overnight. The soft US pending home sales and Dallas Fed manufacturing data may also have sparked recession isn’t good for equities thoughts. With sentiment wavering, Wall Street lightened up some recent longs, sending the equity markets to a negative close. The S&P 500 eased 0.30% lower, the Nasdaq fell by 0.83%, and the Dow Jones fell by 0.20%. US futures are holding steady in Asia this morning.

Across Asia itself, markets appear content to follow Wall Street’s lead, as they have done recently, with markets locally moving lower in response, although not markedly so. Japan’s Nikkei 225 is unchanged, with South Korea’s Kospi down just 0.10%. In mainland China, the Shanghai Composite and CSI 300 are 0.05% lower. In Hong Kong, the Nasdaq-following Hang Seng is down 0.75%, retracing some of yesterday’s rally.

In regional markets, Singapore is 0.20% lower, with Taipei slipping by 0.75%, reacting to an impending 8.40% increase in electricity prices announced yesterday. Kuala Lumpur is 0.10% lower, Jakarta had fallen by 0.60%, Bangkok is 0.15% lower, and Manila has eased just 0.10%.

Australian markets are bucking the trend by rising today. Although most sectors are lower, resources have rallied, perhaps on statements from Shanghai yesterday declaring victory over its latest Covid-19 outbreak. Less restrictive China equals they will buy more resources I suppose, until their next outbreak. The ASX 200 is 0.50% higher, while the All Ordinaries is 0.40% higher.

Europe had a mixed session overnight, showing modest gains with Scandinavian markets outperforming, Stockholm and Helsinki rising by over 3.0%. I am assuming that is because the leaders of Turkey, Sweden and Finland are meeting to thrash out their differences and open NATO membership for the latter two. With Asia in wait-and-see mode today and oil prices rising sharply overnight, Europe is probably going to start its session on the back foot. Month and quarter-end rebalancing flows will potentially distort the price action in both the US and Europe markets this afternoon and for the next couple of days.

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, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was 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 and Channel News Asia as well as in leading print publications such as 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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