Asian Markets Mostly Lower Amid Interest Rate Concerns
Asian stock markets are trading mostly lower in thin trading on Tuesday due to a holiday in most markets, despite the broadly positive cues from Wall Street overnight, as traders remain cautious ahead of the monetary policy announcements from the US Federal Reserve, European Central Bank, the Bank of England and the Reserve Bank of Australia during the week. Asian markets closed mostly lower on Monday.
Concerns about slowing economic growth in China and the ongoing war in Ukraine also weighed on the markets.
The RBA expected to raise interest rates later in the day for the first time in more than a decade to tame surging inflation.
The Fed is also widely expected to hike interest rate by 50 basis points after its two-day monetary policy meeting on Wednesday, the first such increase in about 20 years. The central bank’s views on the economy and the outlook for future rate hikes are in focus.
The Australian stock market is slightly lower on Tuesday, extending the losses in the previous session, with the benchmark S&P/ASX 200 staying above the 7,300 level, despite the broadly positive cues from Wall Street overnight, as the market cautiously await the interest rate decision by the Reserve Bank of Australia later in the day.
The benchmark S&P/ASX 200 Index is losing 7.60 points or 0.10 percent to 7,339.40, after hitting a low of 7,313.50 earlier. The broader All Ordinaries Index is down 8.00 points or 0.11 percent to 7,615.60. Australian stocks closed sharply lower on Monday.
Among the major miners, BHP Group and Mineral Resources are edging down 0.3 percent each, while Rio Tinto is losing almost 1 percent and Fortescue Metals is slipping more than 1 percent. OZ Minerals is flat.
Oil stocks are mixed, with Origin Energy losing almost 1 percent, while Woodside Petroleum is edging up 0.2 percent. Beach energy and Santos are flat.
Among tech stocks, Appen and Afterpay owner Block are surging more than 5 percent each, while WiseTech Global is gaining more than 3 percent, Zip is soaring almost 6 percent and Xero is adding almost 3 percent.
Gold miners are lower. Newcrest Mining and Northern Star Resources are declining more than 1 percent each, while Evolution Mining is losing almost 2 percent, Gold Road Resources is slipping 2.5 percent and Resolute Mining is sliding almost 3 percent.
Among the big four banks, Commonwealth Bank, ANZ Banking and National Australia Bank are losing almost 1 percent each, while Westpac is edging down 0.3 percent.
In economic news, the Reserve Bank of Australia will wrap up its monetary policy meeting and then announce its decision on interest rates. The RBA is expected by many to boost its benchmark lending rate to 0.25 percent from the current 0.10 percent.
In the currency market, the Aussie dollar is trading at $0.710 on Tuesday.
The Japanese stock market is closed for Constitution Day holiday on Tuesday. Japanese shares ended slightly lower on Monday.
In the currency market, the U.S. dollar is trading in the 130 yen-range on Tuesday.
Elsewhere in Asia, New Zealand, Hong Kong and Taiwan are lower by between 0.4 and 0.7 percent each, while South Korea is up 0.5 percent. Markets in a number of the regional bourses are closed on Tuesday, including China for Labor Day and Malaysia, Singapore and Indonesia for Eid-ul-Fitr.
On Wall Street, stocks tumbled on Monday after a weak start and a subsequent modest recovery, but turned positive in the final hour to eventually end the session on a firm note. The major averages all ended with solid gains but it was the Nasdaq which hogged the limelight, gaining as much as 201.38 points or 1.63 percent as it settled at 12,536.02, rallying more than 330 points from a low of 12,202.41.
The Dow settled with a gain of 84.29 points or 0.26 percent at 33,061.50, rebounding from a low of 32,449.87, while the S&P 500 climbed from 4,062.51 to settle at 4,155.38, recording a gain of 23.45 points or 0.57 percent.
Meanwhile, the major European markets showed significant moves to the downside on the day. While the U.K. markets were closed for a bank holiday, the German DAX Index drifted down 1.13 percent and the French CAC 40 shed 1.66 percent.
Crude oil futures settled higher on Monday, recovering from sharp early losses as traders looked ahead to Wednesday’s monetary policy decision from the Federal Reserve and Thursday’s OPEC meeting. West Texas Intermediate Crude oil futures for June ended higher by $0.48 or 0.5 percent at $105.17 a barrel.
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