Asian markets a mix after Wall St. drops

Asian heavyweights gain on lower oil prices

Asia’s northern heavyweights are higher despite a negative Wall Street session overnight, thanks to the slump in oil prices late in the New York session. Wall Street couldn’t hold onto early gains as pre-CPI nerves and recession fears sent US equities down once again. The S&P 500 fell by 0.92%, the Nasdaq by 0.85%, and the Dow Jones by 0.62%. US futures are showing resilience in Asia though, suggesting choppy trading ahead of the US inflation data tonight. S&P futures are 0.25% higher, Dow futures are 0.15% higher, while Nasdaq futures have jumped by 0.50%.

In Asia, the slump in oil prices overnight has lifted the northern Asia heavyweights, all of whom are voracious consumers of imported energy. Japan’s Nikkei 225 has gained 0.35%, with South Korea’s Kospi rising by 0.75%. In mainland China, the Shanghai Composite is 0.35% higher, while the CSI 300 has gained 0.45%. Hong Kong has risen by 0.70%. Taipei has leapt 2.85% higher after the government activated its stock stabilisation fund today.

Elsewhere, growth-centric ASEAN has been unable to replicate those gains, following Wall Street’s overnight lead and heading south this morning. Singapore has fallen by 0.70%, with Jakarta losing 0.55%, and Kuala Lumpur falling by 0.65%. Manila continues to struggle as markets price in more aggressive tightening from the BSP and the trade balance deteriorates, retreating by 1.10% today. Bangkok has lost 0.75% today.

Australian markets are treading water after resource prices fell again overnight. The ASX 200 and All Ordinaries are ranging narrowly on each side of unchanged.

European markets conjured up a relied rally overnight, perhaps driven by Canada releasing a previously embargoed gas pipeline pump back to Russia, lifting hopes that Nord Stream 1 will start flowing again after maintenance finishes on the 21st of July. The momentum from that trade is going to wane quickly though, and Europe will be casting a nervous glance at US inflation data this evening, and inflation data from German, France, and Spain. I expect a cautious slightly negative, opening this afternoon.

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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