Asian equity markets are predominantly trading higher on Thursday, buoyed by optimistic signals from Wall Street. However, traders maintain a cautious stance due to rising tensions in the Middle East following Iran's ballistic missile assault on Israel. Additionally, strong U.S. private sector employment figures have reduced the likelihood of aggressive interest rate cuts by the Federal Reserve. It is worth noting that Asian markets generally closed lower on Wednesday.
In the Australian market, trading has dipped slightly on Thursday, continuing the trend from the previous two days, despite the positive cues from Wall Street. The benchmark S&P/ASX 200 index hovers just above the 8,200 mark, as concerns persist about escalating Middle East tensions. The S&P/ASX 200 Index is marginally down by 0.20 points to 8,198.00, after hitting a peak of 8,221.70 earlier in the day. Meanwhile, the broader All Ordinaries Index has decreased slightly by 3.00 points to 8,466.90, following a modest decline in Australian stocks on Wednesday.
Within the mining sector, Rio Tinto and Fortescue Metals have each inched up between 0.1 to 0.4 percent, while BHP Group has risen by more than 1 percent. Conversely, Mineral Resources experienced a slight fall of 0.2 percent. Oil sector stocks are generally lower, with Woodside Energy, Santos, and Origin Energy seeing small declines of 0.1 to 0.5 percent, while Beach Energy remains flat.
In technology, Block, the owner of Afterpay, and Appen are down by over 1 percent each, with Xero and Zip recording smaller declines of 0.1 to 0.4 percent. WiseTech Global is down nearly 1 percent. Among the major banks, Commonwealth Bank and National Australia Bank have inched up by 0.2 to 0.5 percent each, whereas Westpac has declined by more than 1 percent and ANZ Banking by 0.2 percent.
Gold mining companies show mixed results; Evolution Mining is down 0.3 percent, Resolute Mining fell over 1 percent, and Northern Star Resources has dropped almost 1 percent. However, Gold Road Resources inched up 0.1 percent, and Newmont rose nearly 1 percent.
On the economic front, the Australian services sector continued its expansion in September, though at a slower rate, as per the latest survey by Judo Bank. The services PMI stood at 50.5, down from 52.5 in August but still above the 50 mark that separates expansion from contraction. The composite index, however, dipped into contraction territory with a PMI of 49.6, down from 51.7 in August.
According to the Australian Bureau of Statistics, Australia recorded a seasonally adjusted trade surplus of A$5.644 billion in August, surpassing forecasts of A$5.510 billion and rising from a revised surplus of A$5.636 billion in July. Exports fell marginally by 0.2 percent to A$43.227 billion, following a downward revision from the previous month's 0.3 percent rise. Imports also declined by 0.2 percent to A$37.582 billion after an upwardly revised 0.6 percent drop in the previous month.
In terms of currency, the Australian dollar is trading at $0.688 on Thursday.
Recovering losses from the previous session, Japanese markets have rallied sharply on Thursday, influenced by Wall Street's positive performance. The Nikkei 225 surged by over 2 percent to exceed the 38,600 level, with gains permeating all sectors, especially among major and tech stocks.
Investors reacted to statements from Japan’s newly appointed Economy Minister, suggesting the central bank exercise caution in raising interest rates as the country continues to emerge from deflation.
The core Nikkei 225 Index concluded the morning session at 38,655.03, climbing 846.27 points or 2.24 percent, after reaching an intraday high of 38,856.75. Japanese stocks had sharply declined on Wednesday.
Key market player SoftBank Group increased by over 3 percent, while Fast Retailing, the operator of Uniqlo, also added more than 3 percent. Among automakers, Toyota gained almost 3 percent, and Honda added over 2 percent.
In the tech sector, Tokyo Electron rose more than 3 percent, Advantest gained over 4 percent, and Screen Holdings advanced by more than 4 percent.
Conversely, within the banking sector, Mizuho Financial dipped nearly 2 percent, Mitsubishi UFJ Financial edged down 0.3 percent, and Sumitomo Mitsui Financial declined almost 1 percent.
Regarding major exporters, Canon, Sony, and Mitsubishi Electric each gained almost 2 percent, while Panasonic advanced by more than 3 percent.In recent market activities, M3 has seen a significant increase, rising by over 8%, while Disco and Sumitomo Pharma have each experienced gains exceeding 6%. TDK and Mazda Motor are both up by more than 5%, with Mitsubishi Motors, Taiyo Yuden, Lasertec, and Daiichi Sankyo close behind, each posting increases of nearly 5%. Additionally, Tokio Marine, Subaru, Renesas Electronics, Ajinomoto, and JTEKT have all advanced by over 4%.
On the other hand, there have been no noteworthy declines among the major stocks.
Turning to economic developments, Japan's services sector has continued its expansion in September, albeit at a slightly reduced pace. The latest findings from Jibun Bank indicate a services Purchasing Managers' Index (PMI) score of 53.1, a slight decrease from August's 53.7. Importantly, this score remains above the threshold of 50, which delineates expansion from contraction. Additionally, the composite PMI decreased to 52.0 in September from 52.9 in August.
In the currency exchange arena, the U.S. dollar is trading in the upper 146 yen range on Thursday.
In other Asian financial developments, Hong Kong's market is down 3.3%, while Malaysia and Indonesia are experiencing minor declines of 0.3% and 0.7%, respectively. In contrast, New Zealand and Singapore have risen by 0.7% and 0.1%, respectively. Notably, markets in South Korea and China are closed in observance of the National Day holiday, while Taiwan remains closed for a second consecutive day due to Typhoon Krathon.
On Wall Street, stock movements showed a lack of clear direction during Wednesday's trading session. After initially dipping, major averages oscillated around the unchanged line throughout the day, eventually closing with slight gains. The Dow Jones Industrial Average edged up by 39.55 points, or 0.1%, to close at 42,196.52. The Nasdaq rose by 14.76 points, or 0.1%, to 17,925.12, and the S&P 500 increased slightly by 0.79 points, or less than 0.1%, closing at 5,709.54.
European markets concluded the day with mixed results. The German DAX Index fell by 0.3%, whereas the French CAC 40 Index made a slight gain of 0.1% and the U.K.'s FTSE 100 Index climbed by 0.2%.
In the commodities market, crude oil prices saw moderate increases on Wednesday as traders anticipated potential supply reductions amid ongoing geopolitical tensions in the Middle East. Specifically, the West Texas Intermediate crude oil futures for November closed up by $0.27, or 0.39%, at $70.10 per barrel.
