Asian equities follow Wall Street higher

Asian markets rally

The perpetual armies of bullish investors dominated New York overnight, and also key fast-money markets like Japan today, as they wishfully priced there was no more bad news to come from Eastern Europe or the Fed. That sparked an “efficient market pricing” rally that saw New York record some impressive gains, with “value” the winner, over growth. The S&P 500 finished 1.15% higher, while the Nasdaq leapt 1.96% higher, and the Dow Jones gained 0.76%. In Asia, the rally continues, US futures on all three indexes creeping 0.15% higher despite US yields also rising in Asia, along with Australian CGBs and Japanese JGBS.

The Nikkei 225 has seen hot money pouring in thanks to a much weaker yen today boosting export hopes (while ignoring the energy bill). The Nikkei 225 has soared 2.75% higher, while South Korea’s Kospi has risen by 0.75%. Mainland China markets have climbed modestly, Covid-19 fears tempering gains. The Shanghai Composite and CSI 300 have risen by 0.35%. China’s tech-heavyweight buyback fever has lifted the Hang Seng to a 1.25% gain.

In regional markets, Singapore is 0.45% higher ahead of inflation data, while Taipei has rallied by 0.90%, and Kuala Lumpur has gained 0.70%, with Jakarta unchanged. Bangkok is 0.20% higher and Manila has fallen by 0.35%. Australian markets, perhaps with one eye on higher US and Australian yields today, have posted only modest gains. The ASX 200 and All Ordinaries rose by around 0.50%.

European markets also joined in the US ‘peak-Ukraine, peak-Fed” fever yesterday, a palpable sigh of relief flowing through European markets as the EU declined to embargo Russian oil. The slowing flows via the CPC may yet deliver another dose of reality to Europe and its energy vulnerability. European equities have posted some impressive gains this past week, maintaining them from here will be challenging I believe.

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