Asian Markets Track Wall Street Higher

Asian Markets Track Wall Street Higher

January 17, 2023

Asian stock markets are trading mostly higher on Wednesday, following the broadly positive cues from Wall Street overnight, as optimism surrounding China’s reopening helped offset concerns about interest rates. US Fed Chair Jerome Powell refrained from commenting on monetary policy at a symposium. Asian Markets closed mixed on Tuesday.

However, in his speech in Stockholm, Powell stressed the case for monetary policy independence and noted that price stability is the bedrock of a healthy economy. He emphasized the need for the central bank to be free of political influence while it tackles high inflation.

Meanwhile, the World Bank slashed its global growth forecasts in its latest Global Economic Prospects report and warned that new adverse shocks could tip the global economy into a recession.

Traders are now looking ahead to key U.S. inflation data for December due on Thursday for additional clues on the economy and interest the rate outlook.

The Australian stock market is trading significantly higher on Wednesday, recouping the losses in the previous session, with the benchmark S&P/ASX 200 moving to just a tad below the 7,200 level, following the broadly positive cues from Wall Street overnight, aided by gains in mining and energy sectors amid firmer commodity prices.

The index came off its highs after domestic inflation data showed cost living increased by 7.3 percent over the year to November, up from 6.9 per cent in October. This came in above expectations of a 7.2 percent rise.

The benchmark S&P/ASX 200 Index is gaining 67.70 points or 0.95 percent to 7,198.70, after touching a high of 7,204.00 earlier. The broader All Ordinaries Index is up 71.80 points or 0.98 percent to 7,408.40. Australian stocks ended modestly lower on Tuesday.

Among major miners, BHP Group, Rio Tinto and Fortescue Metals are gaining almost 2 percent each, while Mineral Resources is advancing almost 3 percent. OZ Minerals is flat.

Oil stocks are mostly higher. Santos is edging up 0.1 percent, while Beach energy and Woodside Energy are gaining more than 1 percent each. Origin Energy is losing almost 1 percent.

In the tech space, Afterpay owner Block is gaining almost 2 percent and Appen is up almost 1 percent, while Xero is slipping more than 6 percent and WiseTech Global is edging down 0.2 percent. Zip is flat.

Among the big four banks, National Australia Bank is gaining more than 1 percent, ANZ Banking is adding almost 1 percent and Commonwealth Bank is edging up 0.1 percent. Westpac is flat.

Among gold miners, Newcrest Mining and Northern Star Resources are gaining almost 2 percent, while Evolution Mining and Gold Road Resources are adding more than 2 percent each. Resolute Mining is up more than 1 percent.

In the currency market, the Aussie dollar is trading at $0.689 on Wednesday.

The Japanese stock market is significantly higher on Wednesday, extending the gains in the previous three sessions, with the Nikkei 225 moving above the 26,400 level, following the broadly positive cues from Wall Street overnight, aided by gains in exporters, technology and financial stocks.

The benchmark Nikkei 225 Index closed the morning session at 26,457.56, up 282.00 points or 1.08 percent, after touching a high of 26,479.99 earlier. Japanese stocks ended significantly higher on Tuesday.

Market heavyweight SoftBank Group is gaining almost 1 percent and Uniqlo operator Fast Retailing is adding 1.5 percent. Among automakers, Honda is edging down 0.5 percent, while Toyota is edging up 0.2 percent.

In the tech space, Tokyo Electron, Screen Holdings and Advantest are gaining more than 1 percent each.

In the banking sector, Sumitomo Mitsui Financial is edging up 0.3 percent, while Mitsubishi UFJ Financial and Mizuho Financial are adding almost 1 percent each.

Among the major exporters, Sony is gaining more than 2 percent and Canon is adding more than 1 percent, while Mitsubishi Electric and Panasonic are up almost 1 percent each.

Among the other major gainers, Yaskawa Electric is surging more than 6 percent, while Fanuc and Hoya are gaining more than 4 percent each. Keyence and Fujitsu are adding more than 3 percent each, while M3, Nikon and Seven & I Holdings are up almost 3 percent each.

Conversely, there are no major losers.

In the currency market, the U.S. dollar is trading in the mid-132 yen-range on Wednesday.

Elsewhere in Asia, Hong Kong is adding 1.4 percent, while China, South Korea, Singapore and Malaysia are higher by between 0.1 and 0.4 percent each. Indonesia and Taiwan are down 0.9 and 0.2 percent, respectively. New Zealand is relatively flat.

On Wall Street, stocks climbed higher and settled on a firm note on Tuesday after swinging between gains and losses till a little past noon. Optimism surrounding China’s reopening helped offset concerns about interest rates.

The major averages all ended with strong gains. The Dow ended higher by 186.45 points or 0.56 percent at 33,704.10. The S&P 500 settled at 3,919.25, up 27.16 points or 0.7 percent from the previous close. The Nasdaq climbed 106.98 points or 1.01 percent to settle at 10,742.63.

Meanwhile, the major European markets have all moved to the downside on the day. The U.K.’s FTSE 100 dropped 0.39 percent, Germany’s DAX ended 0.12 percent down, and France’s CAC 40 drifted down 0.55 percent.

Crude oil prices settled higher on Tuesday, gaining for a fourth straight session, amid expectations energy demand will pick up after China decided to reopen its economy. West Texas Intermediate Crude oil futures for February ended higher by $0.49 or about 0.7 percent at $75.12 a barrel.

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