Asian Markets Show Mixed Trend Amid Cautious Trade

Asian stock markets are trading mixed on Tuesday, following the mixed cues from Wall Street overnight. Investors keenly await the U.S. Federal Reserve’s monetary policy announcement on Wednesday for cues about global economic recovery before making any major moves. The coronavirus infection rate in the region is also keeping the underlying mood cautious. Asian stocks ended mostly higher on Monday.

Meanwhile, the G7 summit has ended with a pledge to continue to support economies with investment until pandemic subsidies.

The Australian stock market is modestly higher on Tuesday, after a long weekend, with the benchmark S&P/ASX 200 staying just below the 7,400 level near fresh all-time highs, following the mixed cues from Wall Street overnight. Stocks across most sectors are ahead with the exception of gold miners.

Traders are also relieved after no new COVID-19 infection cases were reported, with the active cases across Victoria standing at 54.

The benchmark S&P/ASX 200 Index is gaining 51.80 points or 0.71 percent to 7,364.10, after touching an all-time high of 7,394.30 earlier. The broader All Ordinaries Index is up 68.30 points or 0.90 percent to 7,645.50. Australian markets were closed for a holiday on Monday.

Among the major miners, BHP Group is gaining almost 1 percent, while Rio Tinto and OZ Minerals are adding more than 1 percent each. Mineral Resources and Fortescue Metals are rising almost 3 percent each. Fortescue Metals has confirmed it is in talks with the Government of the Democratic Republic of Congo to develop a US$80 billion hydro power project.

Oil stocks are mixed. Oil Search and Origin Energy are edging up 0.1 percent each, while Santos and Beach energy are edging down 0.3 percent each. Woodside Petroleum is flat.

Among the big four banks, ANZ Banking is adding 0.5 percent, while National Australia Bank, Westpac and Commonwealth Bank are gaining almost 1 percent each.

Among tech stocks, Afterpay is gaining almost 2 percent, while Xero and WiseTech Global are adding more than 1 percent each. Appen is losing almost 1 percent.

Gold miners are mostly lower after gold prices tumbled overnight. Gold Road Resources is losing almost 4 percent, Newcrest Mining is declining almost 2 percent and Resolute Mining is lower by almost 1 percent, while Evolution Mining and Northern Star Resources are down almost 3 percent each.

In other news, shares in Nuix are up almost 3 percent after the troubled tech company announced its chief executive officer Rod Vawdrey will retire. This is fresh on the heels of chief financial officer Stephen Doyle exit.

American private equity firm Oaktree has revised its offer to Crown Resorts to provide up to $3 billion funding so it can buy out major shareholder James Packer’s problematic 10 percent stake in the company.

Metal recycler Sims Metal lifted its full-year guidance due to higher scrap prices and the insatiable global demand for resources. The stock is up 2 percent.

Shares in takeover target McPherson’s are plummeting more than 16 percent after potential acquirer Arrotex withdrew its offer for the consumer products seller following four weeks of due diligence.

Semiconductor company Archer Materials announced plans to collaborate with the Australian Missile Corporation to build Australia’s Sovereign Guided Weapons Enterprise. The stock is up more than 5 percent.

Japara Healthcare has received a rival $326 million acquisition bid from RSL Care RDNS Ltd., which beat last week’s improved $320 million offer from Little Company of Mary Health Care, operators of the Calvary retirement homes. Japara is surging more than 6 percent

Shares in Austal are plunging almost 8 percent after the shipbuilder downgraded its full-year guidance due to supply chain disruptions and potential costs or fines from regulatory legal action.

In economic news, members of the Reserve Bank of Australia’s monetary policy board said the country’s economic recovery is continuing at a solid pace with an upbeat outlook, minutes from the central bank’s June 1 meeting revealed on Tuesday. At the meeting, Australia’s central bank left its key interest rate at a record low of 0.10 percent and the government bond yield target unchanged, as widely expected, as it will review the asset purchase program next month.

In the currency market, the Aussie dollar is trading at $0.770 on Tuesday.

The Japanese stock market is modestly higher on Tuesday, extending the gains of the previous session, with the benchmark Nikkei index adding more than 200 points to be just below the 29,400 level, following the mixed cues from Wall Street overnight. Traders are upbeat after the Bank of Japan announced that will extend its pandemic-relief programs to support a fragile economic recovery.

Traders also welcomed the Japanese government’s decision to lift the COVID-19 state of emergency in Olympics city Tokyo and downgrade to quasi-emergency state in three prefectures as infections steadily decline and the strain on hospitals eased.

The benchmark Nikkei 225 Index closed the morning session at 29,375.94, up 214.14 points or 0.73 percent, after touching a high of 29,450.29 earlier. Japanese shares closed notably higher on Monday.

Market heavyweight SoftBank Group is edging down 0.5 percent, while Uniqlo operator Fast Retailing is edging up 0.2 percent. Among automakers, Honda and Toyota are edging up 0.3 percent each, while Mazda is edging down 0.4 percent.

In the tech space, Advantest is gaining almost 2 percent, while Tokyo Electron and Screen Holdings are adding more than 1 percent each. In the banking sector, Mitsubishi UFJ Financial, Sumitomo Mitsui Financial and Mizuho Financial are edging up 0.4 percent each.

The major exporters are mixed, with Sony and Canon gaining more than 1 percent each, while Panasonic is edging down 0.1 percent. Mitsubishi Electric is edging up 0.4 percent.

Among the other major gainers, Eisai is gaining more than 4 percent, while Sumco, Sumitomo Realty & Development and Konica Minolta are adding more than 3 percent each. Seiko Epson, Toyo, Seikan Group Holdings, Toto and Nikon are all up almost 3 percent each. Trend Micro, NEC, Dentsu Group, Recruit Holdings, Kyocera and Olympus are higher by more than 2 percent each.

Conversely, Nippon Steel is losing more than 3 percent, while JFE Holdings, ANA Holdings and Kajima are down more than 2 percent each.

In the currency market, the U.S. dollar is trading in the lower 110 yen-range on Tuesday.

Elsewhere in Asia, New Zealand, South Korea, Singapore and Taiwan and are higher by between 0.1 and 0.7 percent each. Hong Kong and China are lower by 1.3 and 0.9 percent, respectively. Indonesia is edging down 0.1 percent and Malaysia is little changed.

On the Wall Street, stocks turned in a mixed performance during trading on Monday, although the tech-heavy Nasdaq and the S&P 500 still managed to reach new record closing highs. The narrower Dow climbed well off its worst levels of the day but still closed in the red.

The Nasdaq climbed 104.72 points or 0.7 percent to 14,174.14 and the S&P 500 rose 7.71 points or 0.2 percent to 4,255.15 after spending much of the day in negative territory. Meanwhile, the Dow dipped 85.85 points or 0.3 percent to 34,393.75.

The major European markets also turned in a mixed performance on the day. While the German DAX Index edged down by 0.1 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index both rose by 0.2 percent.

Crude oil futures ended slightly lower Monday on news that the next phase of England’s lockdown reopening will be delayed due to a surge of the Delta variant of Covid-19. West Texas Intermediate Crude oil futures for July ended down by $0.03 or 0.04 percent at $70.88 a barrel.

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