Asian Markets Track Wall Street Lower

Asian stock markets are trading mostly lower on Tuesday, following the broadly negative cues from Wall Street overnight, dragged by the tumbling Hong Kong market. Traders also reassessed their expectations for the outlook on interest rates after upbeat US jobs data. Escalating tensions in the Middle East is also weighing on market sentiment. Asian markets closed mostly higher on Monday.

Traders also now cautiously await readings on US consumer price and producer price inflation later in the week for further cues.

Reversing the gains in the previous session, the Australian stock market is trading modestly lower on Tuesday after opening in the red and meandering into the green for a bit, following the broadly negative cues from Wall Street overnight. The benchmark S&P/ASX 200 is falling below the 8,200 level, with weakness in technology and financial stocks partially offset by gains in mining and energy stocks.

The benchmark S&P/ASX 200 Index is losing 31.10 points or 0.38 percent to 8,174.30, after hitting a low of 8,169.70 and a high of 8,223.50 earlier. The broader All Ordinaries Index is down 35.50 points or 0.42 percent to 8,443.60. Australian stocks closed notably higher on Monday.

Among the major miners, BHP Group and Mineral Resources are gaining more than 1 percent each, while Rio Tinto is adding more than 2 percent and Fortescue Metals is edging up 0.4 percent.

Oil stocks are mostly higher. Origin Energy and Beach energy are gaining almost 1 percent each, while Woodside Energy and Santos are is adding more than 1 percent each.

Among tech stocks, Zip and WiseTech Global are edging down 0.2 to 0.4 percent each, while Afterpay owner Block and Xero are declining almost 2 percent each. Appen is losing 1.5 percent.

Gold miners are mostly higher. Gold Road Resources and Northern Star resources are gaining almost 2 percent each, while Evolution Mining is up more than 1 percent, Newmont is edging up 0.2 percent and Resolute Mining is advancing almost 4 percent.

Among the big four banks, Commonwealth Bank, Westpac and National Australia Bank are edging down 0.2 to 0.4 percent each, while ANZ Banking is edging up 0.1 percent.

In other news, shares in West African Resources are rallying almost 10 precent, recouping some of yesterday’s 20 per cent slump amid concern about the future of its mining permits in Bukina Faso.

In economic news, the Reserve Bank of Australia will on Tuesday release the minutes from its September 24 monetary policy meeting. At the meeting, the central bank left its interest rate unchanged at a 12-year high of 4.35 percent, as widely expected. The interest rate paid on Exchange Settlement balances was kept unchanged at 4.25 percent.

In the currency market, the Aussie dollar is trading at $0.672 on Tuesday.

The Japanese stock market is significantly lower on Tuesday, snapping a three-session winning streak, with the Nikkei 225 falling below the 38,900 level, following the broadly negative cues from Wall Street overnight, with weakness across most sectors led by index heavyweights and financial stocks.

The benchmark Nikkei 225 Index closed the morning session at 38,861.09, down 471.65 points or 1.20 percent, after hitting a low of 38,853.51 earlier. Japanese shares ended sharply higher on Monday.

Market heavyweight SoftBank Group is losing almost 3 percent and Uniqlo operator Fast Retailing is edging down 0.2 percent. Among automakers, Honda is losing more than 1 percent and Toyota is declining almost 3 percent.

In the tech space, Advantest is gaining more than 2 percent, while Screen Holdings is losing more than 3 percent and Tokyo Electron is declining more than 1 percent.

In the banking sector, Mitsubishi UFJ Financial and Mizuho Financial are losing more than 2 percent each, while Sumitomo Mitsui Financial is declining more than 3 percent.

The major exporters are mostly lower. Mitsubishi Electric is losing more than 2 percent, Panasonic is declining almost 1 percent and Sony is down almost 3 percent, while Canon is adding almost 1 percent.

Among the other major losers, Isetan Mitsukoshi, Nissan Motor, Chiba Bank and Concordia Financial are losing more than 4 percent each, while Yaskawa Electric is slipping almost 4 percent. Mitsui & Co., Shizuoka Financial, Mercari, Sumco and Mazda Motor are declining more than 3 percent each, while Dai-ichi Life, Keyence and Fukuoka Financial are down almost 3 percent each.

Conversely, Kansai Electric Power is advancing more than 4 percent, Fujikura is gaining almost 4 percent and Fujitsu is adding more than 3 percent.

In economic news, the average of household spending was down 1.9 percent on year in August, the Ministry of Economy, Trade and Industry said on Tuesday – coming in at 297,487 yen. That beat forecasts for a decline of 2.6 percent following the 0.1 percent increase in July. The average of monthly income per household stood at 574,334 yen, up 2.0 percent on year. On a monthly basis, household spending rose 2.0 percent – again exceeding expectations for a gain of 0.5 percent after slumping 1.7 percent in the previous month.

The Ministry of Finance said Japan posted a current account surplus of 3.804 trillion yen in August.. That beat forecasts for a surplus of 2.43 trillion yen and was up from 2.80 trillion yen in July. Imports were up 1.3 percent on year to 8.766 trillion yen, while imports climbed an annual 6.2 percent to 8.388 trillion yen for a trade deficit of 377.9 billion yen. The capital account showed a deficit of 24.4 billion yen, while the financial account saw a surplus of 4.187 trillion yen.

In the currency market, the U.S. dollar is trading in the higher 147 yen-range on Tuesday.

Elsewhere in Asia, Hong Kong is plummeting 8.6 percent, while New Zealand, Singapore, South Korea, Malaysia, Taiwan and Indonesia are lower by between 0.1 and 1.0 percent each. China is bucking the trend in post-holiday trading and is up 1.6 percent.

On Wall Street, stocks fell on Monday amid easing prospects of aggressive rate cuts by the Federal Reserve following a much higher than expected addition in U.S. non-payroll employment in the month of September.

The major averages all closed notably lower. The Dow tumbled 398.51 points or 0.94 percent to 41,954.24, the S&P 500 closed down 55.13 points or 0.96 percent at 5,695.94, while the Nasdaq recorded a more pronounced drop, falling by 213.95 points or 1.18 percent to settle at 17,923.90.

Meanwhile, the major European markets were mixed on the day. The U.K.’s FTSE 100 gained 0.28 percent and France’s CAC 40 closed up 0.46 percent, while the German DAX Index slid by 0.9 percent.

Crude oil prices rose sharply on Monday amid the rising possibility of disruptions in supply in the Persian Gulf due to escalating tensions in the Middle East. West Texas Intermediate Crude oil futures for November jumped $2.76 or 3.71 percent at $77.14 a barrel, the highest close in nearly eight weeks.

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