Asian stock markets are trading mostly lower on Monday, following the broadly negative cues from Wall Street on Friday, amid rising concerns about inflationary pressures and prospect of interest rate hikes as traders await the US Fed’s latest policy decision on Wednesday.
Meanwhile, worries about the fast spreading coronavirus Omicron variant’s impact on global economic growth continues to impact market sentiment. Asian markets closed mostly lower on Friday.
The Australian stock market is modestly lower on Monday, extending the losses in the previous session, with the benchmark S&P/ASX 200 staying above the 7,100 level, following the broadly negative cues from Wall Street on Friday, with weakness across all industry sectors, particularly technology and mining stocks, amid fears of inflation and policy tightening by the US Federal Reserve.
Meanwhile, traders remain concerned over the domestic Covid-19 cases, though the daily new cases are on a steady decline. New South Wales reported 15,091 new cases and 24 deaths on Sunday and Victoria also reported 11,695 new cases and 17 deaths. Queensland recorded 10,212 new cases and 13 deaths, ACT reported 756 new cases and Tasmania reported 619 new cases.
The benchmark S&P/ASX 200 Index is losing 28.80 points or 0.40 percent to 7,147.00, after hitting a low of 7,086.80 earlier. The broader All Ordinaries Index is down 40.30 points or 0.54 percent to 7,449.80. Australian stocks closed sharply lower on Friday.
Among the major miners, Rio Tinto and BHP Group are losing more than 1 percent each, while Mineral Resources is slipping more than 4 percent, Fortescue Metals is declining more than 2 percent and OZ Minerals is sliding almost 4 percent. Oil stocks are lower, with Woodside Petroleum, Origin Energy and Santos losing more than 1 percent each, while Beach energy is declining more than 2 percent.
Among tech stocks, Appen is losing almost 2 percent, Zip is declining more than 2 percent and Xero is slipping more than 1 percent, while WiseTech Global is gaining almost 1 percent. Gold miners are lower. Evolution Mining is losing more than 2 percent, Gold Road Resources is slipping almost 4 percent, Northern Star Resources is declining more than 3 percent, Newcrest Mining is sliding almost 2 percent and Resolute Mining is plunging almost 6 percent.
Shares in Regis Resources are tumbling more than 12 percent after the gold miner slashed its full-year outlook.
Among the big four banks, Commonwealth Bank is edging up 0.1 percent, while National Australia Bank is edging down 0.5 percent, Westpac is down almost 1 percent and ANZ Banking is losing more than 1 percent.
In economic news, the manufacturing sector in Australia continued to expand in January, albeit at a slower rate, the latest survey from Markit Economics revealed on Monday with a manufacturing PMI score of 55.3. That’s down from 57.7 in December, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the services PMI tumbled to 45.0 from 55.1 in December, while the composite PMI dropped to 45.3 from 54.9.
In the currency market, the Aussie dollar is trading at $0.718 on Monday.
The Japanese stock market is modestly lower on Monday, extending the losses in the previous session, with the Nikkei 225 just below the 27,400 level, following the broadly negative cues from Wall Street on Friday, with traders selling off stocks amid fears of inflation and policy tightening by the US Federal Reserve.
Traders also remain concerned about the spike in domestic coronavirus cases, with Japan topping 50,000 daily new cases for the second straight day and hitting record highs for the sixth consecutive day. A majority of the 47 prefectures hit record highs, with 17 prefectures under quasi-state of emergency from Friday and more expected to follow.
The benchmark Nikkei 225 Index closed the morning session at 27,371.11, down 151.15 points or 0.55 percent, after hitting a low 27,203.33 earlier. Japanese shares ended significantly lower on Friday.
Market heavyweight SoftBank Group is losing more than 2 percent, while Uniqlo operator Fast Retailing is edging up 0.5 percent. Among automakers, Honda is losing almost 2 percent and Toyota is declining more than 1 percent. In the tech space, Advantest and Tokyo Electron are edging up 0.5 percent each, while Screen Holdings is gaining almost 2 percent. In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are gaining almost 1 percent each, while Mizuho Financial is adding more than 1 percent.
The major exporters are mixed, with Panasonic is edging down 0.2 percent, while Sony gaining almost 2 percent, Canon is adding more than 1 percent and Mitsubishi Electric is edging up 0.3 percent.
Among the other major losers, Mitsui E&S Holdings is plunging almost 12 percent, Nippon Express is losing almost 6 percent, Pacific Metals is slipping almost 5 percent and Nexon is down almost 4 percent, while Daiwa Securities, Casio Computer and Toho Zinc are declining more than 3 percent each. Conversely, Kawasaki Kisen Kaisha and Inpex are gaining almost 4 percent each, while Concordia Financial, Nikon and Fukuoka Financial are adding more than 2 percent each.
In economic news, the manufacturing sector in Japan continued to expand in January, and at a faster rate, the latest survey from Jibun Bank revealed on Monday with a manufacturing PMI score of 54.6. That’s up from 54.3 in December, and it moves further above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the services PMI tumbled to 46.6 from 51.1 in December, while the composite PMI dropped to 48.8 from 51.9.
In the currency market, the U.S. dollar is trading in the higher 113 yen-range on Monday.
Elsewhere in Asia, South Korea is plunging 1.8 percent and Hong Kong is losing 1.2 percent, while New Zealand, Indonesia, Malaysia, Singapore and Taiwan are lower by between 0.2 and 0.9 percent each. China is bucking the trend and is up 0.1 percent. On Wall Street, stocks were down again on Friday, hugging both sides of the unchanged line in the morning before going into freefall in the afternoon to end in the red for the fourth straight session.
For the day, the Dow plummeted 450.02 points or 1.30 percent to finish at 34,265.37, while the NASDAQ plunged 385.10 points or 2.72 percent to close at 13.768.92 and the S&P 500 tumbled 84.79 points or 1.89 percent to end at 4,397.94.
The major European markets also closed sharply lower on the day. The U.K.’s FTSE 100 ended down 1.2 percent, Germany’s DAX tanked 1.94 percent and France’s CAC 40 tumbled 1.75 percent.
Crude oil prices closed lower on Friday for the second straight session, although they came up from session lows. Crude’s correction continued after touching a seven-year high earlier in the week on demand optimism and short-term supply disruptions. West Texas Intermediate crude futures were down 0.86 percent at $84.81 per barrel after falling as much as 3.2 percent earlier.