Indian Morning Briefing: Asian markets mostly up; China’s economic activity slowed in April
GLOBAL MARKETS DJIA 32196.66 466.36 1.47% Nasdaq 11805.00 434.04 3.82% S&P 500 4023.89 93.81 2.39% FTSE 100 7418.15 184.81 2.55% Nikkei Stock 26561.35 133.70 0.51% Hang Seng 19961.53 62.76 0.32% Kospi 2601.09 -3.15 -0.12% SGX Nifty* 15814.00 41.5 0.26% *May contract USD/JPY 128.89-90 -0.26% Range 129.64 128.71 EUR/USD 1.0400-03 -0.11% Range 1.0418 1.0391 CBOT Wheat May $11.672 per bushel Spot Gold $1,812.19/oz 0.1% Nymex Crude (NY) $110.28 $4.15 U.S. STOCKS
US stocks ended higher on Friday after a tough week of losses across major indexes.
The Nasdaq Composite jumped 434.04 points, or 3.8%, to 11,805.00, its biggest one-day percentage gain since November 2020. The S&P 500 gained 93.81 points, or 2.4% , to 4023.89, while Dow Industrials rose 466.36 points, or 1.5%, to 32,196.66. All three indices finished below the highs seen earlier in the session.
Japan’s Nikkei Stock Average rose 1.4% to 26804.37, driven by gains in electronics and tech stocks, helped by a weaker yen and lingering hopes of a recovery in profits after the Covid-19 pandemic. 19. Pneumatic control engineering firm SMC jumped 6.2% after forecasting a 12% rise in operating profit for the financial year. Mobile phone company KDDI gained 3.8% after estimating a 2.3% increase in net profit for the year and announcing a share buyback. Meanwhile, Honda Motor fell 3.0% after Q4 net profit fell 41% year on year. Investors were focused on earnings with Mitsubishi UFJ Financial Group and Recruit Holdings due to announce results later in the day.
South Korea’s Kospi rose 0.4% to 2614.40 in early trading, driven by gains in tech and airline stocks. Index heavyweight Samsung Electronics rose 0.8%. Biotech firm SK Bioscience rose 4.5%, extending its gains to a second day after gaining approval for its typhoid vaccine exports. Apple supplier LG Innotek added 2.1% to strong demand for camera modules. Cinema chain operator CJ CGV gained 3.1% on the ongoing relaxation of Covid-19 social distancing rules. Airlines have moved forward amid a growing number of countries easing pandemic-induced travel controls. Asiana Airlines rose 1.1% ahead of its Q1 earnings report due later today.
Hong Kong’s Hang Seng index pared early gains and last rose 0.2% to 19943.50 as economic data from China failed to meet expectations. Shanghai intends to gradually reopen shopping malls, supermarkets, restaurants and hair salons from Monday, KGI Research said in a morning comment. Among the HSI’s top performers, Country Garden Holdings climbed 5.7%, Galaxy Entertainment 5.4% and Longfor Group 5.4%. The Hang Seng TECH index rose 0.9% to 4076.58.
Chinese stocks pared gains and were mixed after the release of Chinese industrial production data for April. The Shanghai Composite Index fell and was last down 0.1% at 3080.40, the Shenzhen Composite Index was up 0.3% at 1937.20 while the Price Index ChiNext was stable at 2358.61. Auto stocks were down, with SAIC Motor down 2.8% and BYD Co. down 0.8%. The country’s housing market could be in focus, after the PBOC lowered the lower limit on mortgage rates for first-time home buyers on Sunday.
Most Asian currencies gained against the USD early in the Asian session as risk appetite improved in the wake of Friday’s rally on Wall Street. The rise in the USD index could slow if Friday’s rally in risk appetite continues in the near term, Westpac analysts said in a research report. However, the broader USD uptrend remained in good shape, they said, noting that the Fed was still staunchly hawkish as the euro zone faced a more acute stagflationary situation and China struggled against a Covid-19 outbreak with strict lockdowns. USD/KRW fell 0.8% to 1,276.75 and USD/SGD fell 0.2% to 1.3921.
After dropping below its lowest levels since mid-2020, AUD/USD was ripe for another drop, Morgan Stanley said. Currently trading at 0.6949, the pair could drop to 0.6700 over the next few months amid continued risks from China over its zero-Covid policy, while the RBA could likely disappoint relatively stretched market prices. for interest rate hikes. Markets were expecting the RBA to lift its official exchange rate to around 2.8% by the end of the year, from 0.35% currently. Morgan Stanley said it expected a bottom for AUD/USD of 0.6700, but from there a rally down to 0.7000 was still reasonable in 2023.
Gold edged higher in early Asian trading in a likely technical rebound after gold futures posted their lowest close since Feb. 4 on Friday. However, gold has tentatively tested the waters below $1,800 an ounce and still remains in a danger zone for further decline, Oanda’s senior market analyst Edward Moya said in an e -mail. Any decent bounce in the precious metal could fade, with sellers likely emerging well ahead of the $1,840 an ounce level, the analyst said. Spot gold rose 0.1% to $1,812.19 an ounce.
Oil prices reversed direction to lower after rising at the start of Asian trading. The busy travel season in June, July and August would likely boost demand significantly as the need for road and aviation fuel accelerates, Rystad Energy principal analyst Louise Dickson said in an email. Demand for oil to power cooling systems in the Middle East during the “cooking” summer months will also likely be boosted, the analyst said. First-month WTI crude oil futures fell 1.3% to $109.06/bbl; First-month Brent crude oil futures were down 1.5% at $109.91/barrel.
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(END) Dow Jones Newswire
May 15, 2022 11:15 p.m. ET (03:15 GMT)
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