Asian equities are trading soft

Asian markets a mixed bag

Asian equity markets are a very mixed picture today. Price action appears to be erring on the negative side after Wall Street fell overnight, with the rise in energy and commodity prices also weighing on the sentiment of the major importing countries. Balancing that, the impending China property support measures appear to be taking the edge of the negative sentiment.

Overnight, Wall Street finished lower after Apple said it would limit hiring. On a slow news day, with no important data, that was enough for the ever-flighty Wall Street to unwind some of the previous day’s gains. The S&P 500 fell by 0.84%, the Nasdaq by 0.83%, and the Dow Jones by 0.69%. US futures have rebounded in Asia, unwinding some of the overnight session losses. S&P 500 futures have gained 0.35%, Nasdaq futures have jumped by 0.60%, and Dow futures have added 0.15%.

Given the rebound in US futures this morning, the negative edge to early Asia equity trading is slightly surprising. I suspect the 5.0% rise in oil prices overnight is weighing on sentiment in energy-hungry Asia. Japan returns from holiday, with the Nikkei 225 rising by 0.73%, but South Korea’s Kospi has edged 0.30% lower. In China, the Shanghai Composite is unchanged, but the narrower Shanghai 50 has fallen by 0.75%. The CSI 300 is down by 0.55%, while Hong Kong’s Hang Seng has fallen by 0.95%.

In regional markets, Singapore and Taipei are 0.30% lower, with Kuala Lumpur falling by 0.55%, but Jakarta has rallied by 0.50%. Manila is unchanged, with Bangkok falling by 0.90%. Australian markets have edged lower, with commodity price rises offsetting a negative Wall Street session. The ASX 200 and All Ordinaries are down slightly by 0.20%.

European markets booked another impressive day of gains overnight, but with Wall Street lower and Asia looking very mixed, the rebound may struggle for traction this afternoon. I expect nerves around Russian gas flows on Thursday to start eroding sentiment as the week progresses.

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