Asian stock markets displayed mixed performance on Wednesday, influenced by the negative indicators from Wall Street the previous night. Investors are anticipating significant U.S. consumer price inflation data later today, which could impact the Federal Reserve's approach to interest rates. While signals of a policy shift in China have buoyed investor sentiment, escalating geopolitical tensions in Syria continue to weigh heavily on the markets. Asian markets concluded with mixed results on Tuesday.
The Federal Reserve is anticipated to reduce rates by 25 basis points next week, but forthcoming data may alter expectations for further cuts. The CME Group's FedWatch Tool reveals an 86.1% probability of a quarter-point rate cut next week, whereas there's a 69.1% chance that rates will remain steady through late January.
In Australia, shares are trading significantly lower, extending losses from the previous session. The S&P/ASX 200 has dipped below the 8,400 mark, largely due to faltering sectors like mining and energy amid rising commodity prices. Currently, the S&P/ASX 200 Index has fallen by 39.90 points, or 0.48%, to 8,353.10, with the All Ordinaries Index declining by 37.80 points, or 0.44%, to 8,612.20. Australian stocks were notably lower on Tuesday.
Specific declines are noted among major miners, with BHP Group and Fortescue Metals declining by 0.1 to 0.5%, Rio Tinto down nearly 1%, and Mineral Resources decreasing by almost 2%. Oil stocks are weak as well, with Woodside Energy and Beach Energy dropping nearly 1% and more than 2%, respectively. Santos and Origin Energy are down over 1% each.
In the tech sector, Block (owner of Afterpay), WiseTech Global, Xero, and Zip all slipped by over 1%, although Appen gained nearly 5%. Among the major banks, Commonwealth Bank and Westpac inched up 0.1 to 0.2%, while ANZ Banking slightly declined by 0.2% and National Australia Bank remained unchanged.
Gold mining firms such as Evolution Mining and Northern Star Resources experienced minor declines of 0.2 to 0.5%, with Newmont falling close to 1% and Gold Road Resources down nearly 2%. Resolute Mining remained flat. In currency exchange, the Australian dollar stands at $0.638.
The Japanese stock market is significantly down on Wednesday, reversing prior gains, with the Nikkei 225 dropping below 39,200. This decline is driven by weak performance in major tech stocks, although some recovery efforts are seen in exporter stocks. The Nikkei 225 concluded the morning session at 39,112.80, down by 254.78 points, or 0.65%.
Leading market heavyweight SoftBank Group decreased by over 1%, while Fast Retailing of Uniqlo fell by 0.3%. In the automotive sector, Honda dropped 0.5% and Toyota slightly fell by 0.1%. Tech companies like Advantest and Screen Holdings saw declines of over 2% and more than 1%, respectively.
In banking, Sumitomo Mitsui Financial and Mizuho Financial saw marginal declines of 0.2 to 0.3%, whereas Mitsubishi UFJ Financial rose by more than 1%. Exporters like Canon and Sony edged up by 0.3%, with Mitsubishi Electric close to a 1% gain and Panasonic up over 1%.
However, there are notable gains elsewhere, with Kawasaki Heavy Industries surging by nearly 6%, IHI up over 4%, and companies like Konica Minolta, Ryohin Keikaku, and Kikkoman each gaining over 3%. T&D Holdings and Kuraray advanced by nearly 3%.
Japan's economic news reveals a 3.7% year-over-year rise in producer prices for November, as reported by the Bank of Japan, exceeding expectations of a 3.4% increase and surpassing the previous month's upwardly revised 3.6% gain. Monthly producer prices climbed 0.3%, consistent with October but above predictions of 0.2%. Export prices rose by 0.2% monthly and 0.7% annually, while import prices fell by 0.5% on month and 2.8% year-on-year.
In the foreign exchange market, the U.S. dollar is trading in the higher 151 yen range on Wednesday.In Asia, stock markets showed mixed results. New Zealand, China, Hong Kong, South Korea, and Indonesia experienced gains ranging from 0.2% to 0.9%. Conversely, markets in Singapore, Malaysia, and Taiwan saw declines between 0.4% and 0.7%.
On Wall Street, stocks experienced a moderate downturn during Tuesday's trading session after an unfulfilled initial upward momentum. This added to the losses recorded on Monday, with both the Nasdaq and the S&P 500 retreating further from last Friday's record highs. Each of the major indexes hit new lows as the session progressed. The Dow Jones Industrial Average dropped by 154.10 points, or 0.4%, closing at 44,247.83. The Nasdaq decreased by 49.45 points, or 0.3%, ending at 19,687.24, while the S&P 500 declined by 17.94 points, or 0.3%, to settle at 6,034.91.
European markets also trended downward. The French CAC 40 Index fell by 1.1%, the UK's FTSE 100 Index dipped by 0.9%, and Germany's DAX Index slightly decreased by 0.1%.
On the commodities front, crude oil prices rose on Tuesday. This was driven by optimism surrounding increased demand from China, following the government's recent announcement of stimulus measures. Specifically, West Texas Intermediate Crude oil futures for January added $0.22, or 0.32%, to reach $68.59 a barrel.
