Asian Markets Trading Mostly Lower

Asian stock markets are trading mostly lower on Tuesday, following the mixed cues from Wall Street overnight, as traders seemed reluctant to make significant moves ahead of the central bank policy meetings in the U.S., Japan and the U.K. later in the week and earnings news from several major technology companies, including Microsoft, Meta, Apple and Amazon. Asian markets closed mostly higher on Monday.

While the US Fed is widely expected to leave interest rates unchanged, traders will be looking to the accompanying statement for additional clues about a possible rate cut in September.

According to CME Group’s FedWatch Tool, there is currently an 89.6 percent chance the Fed will lower rates by a quarter point in September and a 10.1 percent chance of a half point rate cut.

Reversing the gains in the previous two sessions, the Australian stock market is trading notably lower on Tuesday, following the mixed cues from Wall Street overnight. The benchmark S&P/ASX 200 is falling to well below the 8,000 mark, with weakness across most sectors led by mining and financial stocks.

The benchmark S&P/ASX 200 Index is losing 45.90 points or 0.57 percent to 7,943.70, after hitting a low of 7,894.30 earlier. The broader All Ordinaries Index is down 56.80 points or 0.69 percent to 8,167.50. Australian stocks closed significantly higher on Monday.

Among the major miners, BHP Group and Rio Tinto are losing more than 1 percent each. Mineral Resources is down almost 1 percent. Fortescue Metals is plunging more than 9 percent amid reports that JPMorgan’s equity capital markets team was looking for buyers for $1.9 billion of discounted stock on behalf of an undisclosed institutional investor.

Oil stocks are mostly lower. Woodside Energy, Origin Energy and Santos are losing almost 1 percent each, while Beach energy is down more than 1 percent.

Among tech stocks, Afterpay owner Block, Xero and Zip are losing almost 1 percent each, while WiseTech Global is declining more than 2 percent. Appen is skyrocketing more than 29 percent after reporting encouraging Q2 financial results with a 16 percent revenue increase excluding Google amid strength in generative AI projects.

Gold miners are mostly lower. Gold Road Resources is losing more than 1 percent, Northern Star resources is edging down 0.2 percent and Evolution Mining is down almost 1 percent, while Resolute Mining is gaining almost 2 percent. Newmont is flat.

Among the big four banks, Commonwealth Bank and National Australia Bank are losing almost 1 percent each, while ANZ Banking is declining almost 2 percent and Westpac is down more than 1 percent.

In economic news, the total number of building permits issued in Australia was down a seasonally adjusted 6.5 percent on month in June, the Australian Bureau of Statistics said on Tuesday – coming in at 13,237. That misses forecasts for a decline of 2.3 percent following the 5.5 percent increase in May. Permits for private sector houses fell 0.5 percent on month to 9.078, while permits for private sector dwellings excluding houses tumbled 19.7 percent to 3,918.

On a yearly basis, overall consents fell 3.7 percent, while consents for private sector houses jumped 11.0 percent and consents for private sector dwellings excluding houses slumped 22.1 percent. The value of total residential building fell 0.6 percent to A$7.61 billion, while the value of non-residential building fell 16.2 percent to A$4.46 billion.

In the currency market, the Aussie dollar is trading at $0.655 on Tuesday.

Giving up some of the sharp gains in the previous session, the Japanese stock market is significantly lower on Tuesday, with the Nikkei 225 falling to be a tad above the 38,100 level, following the mixed cues from Wall Street overnight, with weakness in technology and financial stocks ahead of the Bank of Japan monetary policy announcement on Wednesday.

The benchmark Nikkei 225 Index closed the morning session at 38,101.24, down 367.39 points or 0.96 percent, after hitting a low of 38,076.70 earlier. Japanese shares ended sharply higher on Monday.

Market heavyweight SoftBank Group is losing almost 2 percent and Uniqlo operator Fast Retailing is also down almost 2 percent. Among automakers, Honda is edging up 0.3 percent and Toyota is also edging up 0.5 percent.

In the tech space, Advantest is losing almost 1 percent, Screen Holdings is declining more than 3 percent and Tokyo Electron is down more than 1 percent.

In the banking sector, Mizuho Financial, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are losing almost 2 percent each.

The major exporters are mostly higher. Panasonic is gaining almost 1 percent, Sony is adding 1.5 percent and Mitsubishi Electric is edging up 0.5 percent, while Canon is losing more than 2 percent.

Among the other major losers, Komatsu is slipping almost 6 percent and Shionogi & Co. is losing almost 5 percent, while Disco, Rakuten Group and Nippon Electric Glass are sliding more than 4 percent each. Socionext is down almost 4 percent and Fujitsu is declining more than 3 percent, while Shin-Etsu Chemical, Mercari, Sumco, Shizuoka Financial, Chiba Bank and Fukuoka Financial are losing almost 3 percent each.

Conversely, Fanuc is gaining almost 3 percent.

In economic news, the unemployment rate in Japan came in at a seasonally adjusted 2.6 percent in June, the Ministry of Internal Affairs and Communications said on Tuesday. That was beneath expectations for 2.6 percent, which would have been unchanged from the May reading.

The jobs-to-applicant ratio was 1.23, shy of forecasts for 1.24 – which also would have been unchanged. The participation rate was 63.7 percent – exceeding expectations for 63.4 percent and up from 63.3 percent in the previous month.

In the currency market, the U.S. dollar is trading in the higher 153 yen-range on Tuesday.

Elsewhere in Asia, Hong Kong, South Korea and Taiwan are down between 1.0 and 1.4 percent each, while China and Indonesia are down 0.4 and 0.6 percent, respectively. New Zealand is up 0.6 percent, while Malaysia and Singapore are up 0.1 percent each.

On Wall Street, stocks moved to the upside early in the session on Monday but showed a lack of direction over the course of the trading day. The major averages spent the day bouncing back and forth across the unchanged line after posting strong gains last Friday.

The major averages eventually ended the session narrowly mixed. While the Dow edged down 49.41 points or 0.1 percent to 40,539.93, the Nasdaq inched up 12.32 points or 0.1 percent to 17,370.20 and the S&P 500 crept up 4.44 points or 0.1 percent to 5,463.54.

Meanwhile, most European stocks moved to the downside on the day. The French CAC 40 Index slumped by 1.0 percent and the German DAX Index fell by 0.5 percent, although the U.K.’s FTSE 100 Index bucked the downtrend and inched up by 0.1 percent.

Crude oil prices fell to a seven-week low on Monday amid concerns about the outlook for demand from China, and ahead of Thursday’s OPEC meeting. West Texas Intermediate Crude oil futures for September ended down $1.35 or 1.8 percent at $75.81 a barrel.

Business News