Asian Markets Track Wall Street Higher

Asian stock markets are mostly higher on Wednesday, following the broadly positive cues from Wall Street overnight, amid optimism about the outlook for interest rates following last week’s tamer-than-expected US consumer price inflation data. Some traders also kept on the sidelines ahead of a relatively quiet last week of the year. Asian markets closed mixed on Tuesday.

On the heels of the US inflation data, CME Group’s FedWatch Tool is indicating a 72.7 percent chance the Federal Reserve will cut rates by a quarter point in March.

Australian shares are trading significantly higher on Wednesday, recouping the losses in the previous two sessions, with the benchmark S&P/ASX 200 moving well above the 7,500 level to ten-month highs, following the broadly positive cues from Wall Street overnight, with gains across most sectors led by technology stocks. Mining and energy stocks were also gaining from a spike in commodity prices.

The benchmark S&P/ASX 200 Index is gaining 72.70 points or 0.97 percent to 7,574.30, after touching a high of 7,593.40 earlier. The broader All Ordinaries Index is up 72.50 points or 0.97 percent to 7,808.20. Australian stocks ended slightly lower on Friday prior to the holidays on Monday and Tuesday.

Among major miners, Mineral Resources is gaining more than 2 percent, BHP Group is adding 1.5 percent, Rio Tinto is up almost 1 percent and Fortescue Metals is edging up 0.5 percent.

Oil stocks are mostly higher. Santos, Beach energy and Woodside Energy are gaining almost 1 percent each, while Origin Energy is edging down 0.2 percent.

In the tech space, Afterpay owner Block and Zip are gaining almost 2 percent each, while WiseTech Global is adding more than 1 percent and Xero is up almost 1 percent, while Appen is losing more than 2 percent.

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

Among gold miners, Newmont is gaining almost 1 percent and Gold Road Resources is adding more than 1 percent, while Evolution Mining and Northern Star Resources are edging up 0.2 to 0.3 percent each. Resolute Mining is flat.

In the currency market, the Aussie dollar is trading at $0.683 on Wednesday.

The Japanese stock market is significantly higher on Wednesday, extending the gains in the previous three sessions, following the broadly positive cues from Wall Street overnight. The Nikkei 225 index moved well above the 33,600 level, with gains across most sectors, led by index heavyweights and technology stocks.

The benchmark Nikkei 225 Index closed the morning session at 33,658.32, up 352.47 points or 1.06 percent, after touching a high of 33,755.75 earlier. Japanese stocks ended modestly higher on Tuesday.

Market heavyweight SoftBank Group is surging almost 5 percent and Uniqlo operator Fast Retailing is adding more than 1 percent. Among automakers, Honda is gaining almost 1 percent and Toyota is adding more than 1 percent.

In the tech space, Advantest is gaining more than 1 percent, Tokyo Electron is adding almost 2 percent and Screen Holdings is advancing almost 1 percent.

In the banking sector, Mizuho Financial and Sumitomo Mitsui Financial are gaining almost 1 percent each, while Mitsubishi UFJ Financial is edging up 0.3 percent.

Among the major exporters, Sony is gaining more than 1 percent and Canon is edging up 0.5 percent, while Panasonic and Mitsubishi Electric are adding almost 1 percent each.

Among other major gainers, Kawasaki Kisen Kaisha is gaining more than 4 percent, while Mitsui O.S.K. Lines and Sumitomo Pharma are adding more than 3 percent each. Nippon Yusen K.K., CyberAgent, Taiyo Yuden, Kobe Steel and Murata Manufacturing are advancing almost 3 percent each.

Conversely, there no other major losers

In the currency market, the U.S. dollar is trading in the mid-142 yen-range on Wednesday.

Elsewhere in Asia, Hong Kong is up 1.2 percent, while New Zealand, Singapore, Malaysia, Taiwan and Indonesia are higher by between 0.1 and 0.6 percent each. China and South Korea are down 0.2 percent each.

On the Wall Street, stocks moved mostly higher during trading on Tuesday, with the major averages all moving to the upside after ending last Friday’s session narrowly mixed. The advance on the day represents a positive start to the final trading week of 2023.

The major averages pulled back off their best levels going into the close but remained in positive territory. The Dow rose 159.36 points or 0.4 percent to 37,545.33, the Nasdaq advanced 81.60 points or 0.5 percent to 15,074.57 and the S&P 500 climbed 20.12 points or 0.4 percent to 4,774.75.

Meanwhile, the major European markets remained closed on the day in observance of Boxing Day.

Crude oil prices surged higher Tuesday amid escalating tensions in the Middle East and concerns over trade disruptions following attacks on ships. West Texas Intermediate Crude oil futures for February jumped $2.01 or 2.7 percent at $75.57 a barrel.

Market Analysis