Asian Markets Show Mixed Trend

Asian Markets Show Mixed Trend

August 16, 2021

Asian stock markets are trading mixed on Tuesday, following the mixed cues from Wall Street overnight, with a steep drop in crude oil prices and the surge in the spread of the delta variant of coronavirus and the resultant fresh restrictions in several countries, including China, weighing on investor sentiment. Asian stocks ended mixed on Monday.

However, the recent strong US jobs data raised hopes that the Federal Reserve might hike rates sooner than earlier thought. Investors are also awaiting U.S. inflation data due on Wednesday, and look ahead to speeches from several Federal Reserve officials to assess the outlook for monetary policy.

The Australian stock market is slightly higher on Tuesday, extending the gains in the previous four sessions, with the benchmark S&P/ASX 200 above the 7,500 level near fresh all-time highs, following the mixed cues from Wall Street overnight, as traders digested upbeat domestic earnings results. However, they remain concerned about the spread of the highly contagious coronavirus variants primarily in New South Wales, threatening to weigh on the economy.

NSW has reported 356 new locally acquired cases of COVID-19, Victoria has recorded 20 locally acquired cases and Queensland has reported three on Monday.

The benchmark S&P/ASX 200 Index is gaining 5.80 points or 0.07 percent to 7,544.20, after touching an all-time high of 7,576.30 earlier. The broader All Ordinaries Index is up 9.10 points or 0.12 percent to 7,813.40. Australian stocks closed slightly higher on Monday.

Among the major miners, BHP Group is edging up 0.4 percent and Mineral Resources is gaining almost 3 percent, while Fortescue Metals and OZ Minerals are edging down 0.3 percent. Rio Tinto is flat.

Oil stocks are mixed. Santos is edging down 0.5 percent, while Woodside Petroleum is flat. Beach energy is losing 0.4 percent. Oil Search is flat and Origin Energy is up almost 1 percent.

Among the big four banks, Commonwealth Bank and Westpac are gaining almost 1 percent each, while National Australia Bank is edging up 0.4 percent and ANZ Banking is edging up 0.2 percent.

National Australia Bank announced it will acquire Citigroup’s Australian consumer business for a total cost of $1.2 billion including a cash premium of $250 million. Approximately 800 Citigroup employees will join NAB.

Among tech stocks, Xero is gaining almost 1 percent, Appen is adding more than 1 percent and Afterpay is up more than 3 percent. WiseTech Global is flat.

Gold miners are mostly lower. Resolute Mining is losing almost 3 percent, Northern Star Resources is down almost 2 percent, Gold Road Resources is lower by more than 1 percent and Newcrest Mining is edging down 0.4 percent. Evolution Mining is flat.

In other news, shares in James Hardie are gaining more than 4 percent after the building supplies maker boosted its guidance on strong growth expectations across North America, Asia Pacific and Europe for the current year ending March 31.

In the currency market, the Aussie dollar is trading at $0.732 on Tuesday.

The Japanese stock market is slightly higher after the long weekend on Tuesday, extending the gains in the previous two sessions, with the benchmark Nikkei index just below the 27,900 level, following the mixed cues from Wall Street overnight, even as traders remain spooked as more prefectures are under the state of emergency until the end of the month amid the surge in the coronavirus’s delta variant infections.

The benchmark Nikkei 225 Index closed the morning session at 27,905.73 up 85.69 points or 0.31 percent, after touching a high of 28,128.61 earlier. Japanese markets closed for a holiday on Monday. Japanese shares closed modestly higher on Friday.

Market heavyweight SoftBank Group and Uniqlo operator Fast Retailing are gaining almost 1 percent each. Among automakers, Honda is edging down 0.5 percent, while Toyota is gaining almost 1 percent.

In the tech space, Advantest is edging up 0.3 percent and Screen Holdings is adding 0.5 ercent, while Tokyo Electron is edging down 0.6 percent. In the banking sector, Mitsubishi UFJ Financial and Mizuho Financial are gaining almost 2 percent each, while Sumitomo Mitsui Financial is adding more than 1 percent.

The major exporters are mixed, with Sony losing more than 2 percent and Canon edging down 0.4 percent, while Mitsubishi Electric is gaining almost 1 percent. Panasonic is flat.

Among the other major gainers, Mitsui Mining & Smelting is gaining almost 11 percent and Dowa Holdings is adding almost 7 percent, while Otsuka Holdings, Daiichi Sankyo and Isuzu Motors is up almost 6 percent each. Shionogi is higher by 4.5 percent and Marui Group is adding more than 4 percent, while Keisei Electric Railway and West Japan Railway are adding almost 4 percent.

Conversely, Sumitomo Metal Mining is losing more than 5 percent, BANDAI NAMCO Holdings is down 3.5 percent and Ebara is lower by almost 3 percent.

In economic news, Japan posted a current account surplus of 905.1 billion yen in June, the Ministry of Finance said on Tuesday. That exceeded expectations for a surplus of 779.8 billion yen following the 1,979.7 billion yen surplus in May. Exports were up 47.7 percent on year at 7,137 billion yen and imports rose an annual 33.8 percent to 6,488 billion yen for a trade surplus of 648.5 billion yen. The capital account showed a deficit of 36.7 billion yen, while the financial account had a shortfall of 637.0 billion yen.

In the currency market, the U.S. dollar is trading in the lower 110 yen-range on Tuesday.

Elsewhere in Asia, New Zealand, Hong Kong, Singapore and Malaysia are higher by between 0.2 and 0.6 percent each. Meanwhile, South Korea, Taiwan and Indonesia are lower by between 0.6 and 0.9 percent each. China is flat.

On Wall Street, stocks turned in another mixed performance during trading on Monday after ending the previous session on opposite sides of the unchanged line. While the Dow and the S&P 500 pulled back off last Friday’s record closing highs, the tech-heavy Nasdaq edged slightly higher.

The Nasdaq inched up 24.42 points or 0.2 percent to 14,860.18, but the S&P 500 slipped 4.17 points or 0.1 percent to 4,432.35 and the Dow fell 106.66 points or 0.3 percent to 35,101.85.

The major European markets also finished the day mixed. While the U.K.’s FTSE 100 Index crept up by 0.1 percent, the French CAC 40 Index and the German DAX Index both edged down by 0.1 percent.

Crude oil prices declined sharply on Monday amid concerns about outlook for energy demand after China imposed travel curbs at many places in the country, aiming to halt the spread of the delta variant of the coronavirus. West Texas Intermediate Crude oil futures for September ended down $1.80 or 2.6 percent at $66.48 a barrel.

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