Asian stock markets are trading mostly higher on Wednesday, following the broadly positive cues overnight from Wall Street, on rising crude oil prices and easing concerns about the impact of the coronavirus Omicron variant on global economic recovery. Traders also continued to use the recent weakness as an opportunity to pick up stocks at somewhat reduced levels. Asian Markets closed mostly higher on Tuesday.
Further, there is rising expectation that the U.S. Federal Reserve could tighten its monetary policy more aggressively to tame inflation. Comments by Fed officials suggest that the U.S. central bank is likely to decide to double the pace of its taper to $30 billion a month at its December meeting.
The Australian stock market is significantly higher on Wednesday, extending the gains in the previous two sessions, with the benchmark S&P/ASX 200 just below the 7,400 level, following the broadly positive cues overnight from Wall Street, as technology, energy and materials stocks lifted the market after iron ore and crude oil prices jumped. The easing of concerns about the impact of the Omicron variant on global economic recovery also boosted market sentiment.
The benchmark S&P/ASX 200 Index is gaining 76.90 points or 1.05 percent to 7,390.80, after touching a high of 7,399.90 earlier. The broader All Ordinaries Index is up 88.70 points or 1.17 percent to 7,693.90. Australian stocks ended significantly higher on Tuesday.
Among major miners, BHP Group is gaining almost 2 percent, Rio Tinto is adding more than 2 percent, OZ Minerals is up more than 1 percent, Fortescue Metals is advancing almost 3 percent and Mineral Resources is surging almost 5 percent.
Oil stocks are higher. Woodside Petroleum and Santos are gaining more than 2 percent, while Oil Search and Beach energy are advancing almost 3 percent each. Origin Energy is adding more than 1 percent.
Woodside Petroleum said it will invest $5 billion in new energy products by 2030 as it looks to reduce reliance on fossil fuels, including LNG, and tap into cleaner sources of fuel. In the tech space, WiseTech Global is advancing almost 3 percent, Xero is up 1.5 percent and Afterpay is gaining more than 3 percent, while Appen is losing more than 1 percent.
Shares in Zip are surging almost 10 percent after the buy-now pay-later giant reported a record monthly transaction volume of A$906.5 million in November, up 52% from last year.
Among the big four banks, ANZ Banking is losing almost 1 percent, while National Australia Bank and Commonwealth Bank are edging down 0.4 percent each. Westpac is flat.
Among gold miners, Newcrest Mining is edging up 0.2 percent, Gold Road Resources is gaining more than 2 percent, Evolution Mining is adding more than 1 percent and Northern Star Resources is up almost 1 percent, while Resolute Mining is losing almost 1 percent. In the currency market, the Aussie dollar is trading at $0.714 on Wednesday. The Japanese stock market is significantly higher on Wednesday, extending the sharp gains in the previous session, with the benchmark Nikkei index just below the 28,800 level, following the broadly positive cues overnight from Wall Street, on easing of concerns about the impact of the coronavirus Omicron variant on global economic recovery. Meanwhile, Japan’s economy in the July-September period contracted deeper than initially estimated last quarter amid a summer surge in COVID-19 cases that triggered emergency restrictions.
The benchmark Nikkei 225 Index closed the morning session at 28,774.05, up 318.45 points or 1.12 percent, after touching a high of 28,835.01 earlier. Japanese stocks closed sharply higher on Tuesday.
Market heavyweight SoftBank Group is edging up 0.3 percent and Uniqlo operator Fast Retailing is gaining more than 1 percent. Among automakers, Honda is edging down 0.4 percent and Toyota is losing more than 1 percent.
In the tech space, Screen Holdings is gaining almost 2 percent, while Advantest and Tokyo Electron are adding more than 2 percent each.
In the banking sector, Sumitomo Mitsui Financial, Mitsubishi UFJ Financial and Mizuho Financial are gaining almost 1 percent each.
Among the major exporters, Panasonic is losing more than 1 percent, while Sony is gaining more than 2 percent and Canon is adding more than 1 percent. Mitsubishi Electric is flat.
Among the other major gainers, Chugai Pharmaceutical is surging more than 6 percent, Taiyo Yuden is gaining more than 4 percent and Omron is adding almost 4 percent, while Nintendo and Minebea Mitsumi are up more than 3 percent each. Dentsu Group, Nitto Denko and Ricoh are advancing almost 3 percent each.
Conversely, Mitsui Fudosan is losing more than 3 percent, while Credit Saison and are declining almost 3 percent each. In economic news, Japan’s gross domestic product contracted an annualized 3.6 percent on year in the third quarter of 2021, the Cabinet Office said on Wednesday. That missed forecasts for a drop of 3.1 percent following the 2.0 percent increase in the second quarter. On a seasonally adjusted quarterly basis, GDP sank 0.9 percent, also missing forecasts for a drop of 0.8 percent after adding 0.4 percent in the three months prior.
The value of overall bank lending in Japan was up 0.6 percent on year in November, the Bank of Japan said on Wednesday – coming in at 577.074 trillion yen. That’s down from 0.9 percent in October. Excluding trusts, bank lending was up an annual 0.5 percent to 500.885 trillion yen – slowing from 0.8 percent in the previous month. Lending from trusts rose 1.0 percent on year to 76.189 trillion yen, while lending from foreign banks sank 2.5 percent on year to 3.042 trillion yen.
Meanwhile, Japan posted a current account surplus of 1,018.7 billion in October, the Ministry of Finance said on Wednesday – down 39.4 percent on year. That missed expectations for a surplus of 1,308.5 billion yen following the 1,033.7 billion yen surplus in September. Exports were up 11.7 percent on year at 7,080.0 Billion yen and imports jumped an annual 28.3 percent to 6,913.2 billion yen for a trade surplus of 166.7 billion yen. The capital account showed a deficit of 5.4 billion yen, while the financial account had a deficit of 879.6 billion yen.
In the currency market, the U.S. dollar is trading in the mid-113 yen-range on Wednesday.
Elsewhere in Asia, New Zealand is surging 1.3 percent, while China, Hong Kong, South Korea, Taiwan and Indonesia are gaining between 0.2 and 0.9 percent each. Singapore and Malaysia are down 0.2 percent each.
On Wall Street, stocks showed another strong move to the upside during trading on Tuesday following the rally seen to start the week. The major averages all moved sharply higher, with the tech-heavy Nasdaq posting a particularly strong gain.
The Nasdaq soared 461.76 points or 3 percent to 15,686.92, continuing to recover after ending last Friday’s trading at its lowest closing level in well over a month. The Dow also jumped 492.40 points or 1.4 percent to 35,719.43, while the S&P 500 surged up 95.08 points or 2.1 percent to 4,686.75.
The major European markets also showed strong moves to the upside on the day. While the U.K.’s FTSE 100 Index jumped by 1.5 percent, the German DAX Index and the French CAC 40 Index soared by 2.8 percent and 2.9 percent, respectively.
Crude oil prices rose sharply on Tuesday, lifting the most active futures contracts to their highest settlement in two weeks amid rising optimism about the outlook for energy demand. West Texas Intermediate Crude oil futures for January surged $2.56 or 3.7 percent at $72.05 a barrel.