Asian Markets Mostly Lower

Asian stock markets are mostly lower on Wednesday, following the mixed cues from Wall Street overnight, as traders are cautious and look ahead to the US Fed’s interest rate decision later in the day. The Fed is widely expected to leave interest rates unchanged, but the accompanying statement could have a significant impact on the outlook for interest rates. They also react to a slew of economic data from the US, China, Australia and Japan. Asian markets closed mixed on Tuesday.

Extending the gains in the previous seven sessions, Australian shares are trading notably higher on Wednesday after opening in the red, with the benchmark S&P/ASX 200 above the 7,600 level, following the mixed cues from Wall Street overnight, with gains in energy stocks partially offset by losses in mining and technology stocks. The markets pared early losses the release of surprisingly soft domestic inflation data.

The benchmark S&P/ASX 200 Index is gaining 45.30 points or 0.60 percent to 7,645.50, after hitting a low of 7,570.20 and a high of 7,647.20 earlier. The broader All Ordinaries Index is up 42.60 points or 0.54 percent to 7,877.60. Australian stocks ended modestly higher on Tuesday.

Among major miners, Rio Tinto and BHP Group are edging down 0.4 to 0.5 percent each, while Fortescue Metals is losing almost 1 percent and Mineral Resources is declining more than 1 percent.

Oil stocks are mostly higher. Woodside Energy is gaining almost 1 percent, while Beach energy and Origin Energy are advancing almost 2 percent. Santos is flat.

In the tech space, Afterpay owner Block is losing almost 2 percent, Xero is down more than 1 percent and Appen is declining almost 3 percent, while Zip is edging up 0.4 percent and WiseTech Global is gaining almost 1 percent.

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

Among gold miners, Northern Star Resources and Resolute Mining are declining more than 2 percent each, while Gold Road Resources is losing almost 2 percent. Newmont and Evolution Mining are flat.

In economic news, total private sector credit in Australia was up 0.4 percent on month in December, the Reserve Bank of Australia said on Wednesday – unchanged from the November reading. On a yearly basis, private sector credit gained 4.8 percent.

Meanwhile, Australian Bureau of Statistics said consumer prices in Australia were up 4.1 percent on year on year in the fourth quarter of 2023. That was shy of expectations for an increase of 4.3 percent and down from 5.4 percent in the previous three month. On a seasonally adjusted quarterly basis, inflation rose 0.6 percent – again missing forecasts for 0.8 percent and down from 1.2 percent in the three months prior. The Reserve Bank of Australia’s trimmed mean was up 0.8 percent on quarter and 4.2 percent on year, while the weighted mean rose 0.9 percent on quarter and 4.4 percent on year.

In the currency market, the Aussie dollar is trading at $0.657 on Wednesday.

The Japanese stock market is notably lower on Wednesday, giving up some of the gains in the previous two sessions, following the mixed cues from Wall Street overnight. The Nikkei 225 is falling below the 35,900 level, with weakness in index heavyweights and technology stocks partially offset by gains in financial stocks.

The benchmark Nikkei 225 Index closed the morning session at 35,876.96, down 188.90 points or 0.52 percent, after hitting a low of 35,704.58 earlier. Japanese stocks ended slightly higher on Tuesday.

Market heavyweight SoftBank Group is losing almost 2 percent and Uniqlo operator Fast Retailing is declining more than 1 percent. Among automakers, Honda is gaining almost 2 percent and Toyota is edging up 0.2 percent.

In the tech space, Advantest and Tokyo Electron are losing almost 2 percent each, while Screen Holdings is gaining almost 1 percent.

In the banking sector, Mizuho Financial and Mitsubishi UFJ Financial are gaining more than 1 percent each, while Sumitomo Mitsui Financial is adding almost 1 percent.

Among the major exporters, Canon is surging more than 6 percent and Sony is gaining more than 1 percent, while Mitsubishi Electric is edging down 0.4 percent and Panasonic is losing almost 1 percent.

Among other major losers, Alps Alpine is plummeting more than 17 percent, while Fanuc, Pacific Metals, Keyence, M3, Taiyo Yuden and Yokogawa Electric are losing almost 3 percent each.

Conversely, Komatsu is surging more than 7 percent, Hitachi Construction Machinery is gaining more than 4 percent, Furukawa Electric is adding almost 4 percent, Osaka Gas is advancing more than 3 percent and Fujikura is up almost 3 percent.

In economic news, industrial production in Japan was up a seasonally adjusted 1.8 percent on month in December, the Ministry of Economy, Trade and Industry said in Wednesday’s preliminary report. That missed expectations for an increase of 2.4 percent after slipping 0.9 percent in November. On a yearly basis, industrial production was down 0.7 percent.

The total value of retail sales in Japan was up 2.1 percent on year in December, the Ministry of Economy, Trade and Industry said on Wednesday – coming in at 15.515 trillion yen. That missed forecasts for an increase of 4.7 percent following the 5.4 percent jump in November. Retail sales fell 2.9 percent on month. For the fourth quarter of 2023, retail sales gained 3.8 percent on year but shed 1.7 percent on quarter at 42.989 trillion yen. For all of 2023, retail sales climbed 5.6 percent to 162.996 trillion yen.

Industrial output in Japan climbed a seasonally adjusted 1.8 percent on month in December, the Ministry of Economy, Trade and Industry said in Wednesday’s preliminary report. That missed expectations for an increase of 2.4 percent after slipping 0.9 percent in November. On a yearly basis, industrial production was down 0.7 percent.

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

Elsewhere in Asia, Hong Kong and China are down 1.3 and 1.1 percent, respectively. New Zealand, South Korea, Malaysia and Taiwan are lower by between 0.1 and 0.6 percent each. Indonesia and Singapore are up 0.3 and 0.1 percent, respectively.

On the Wall Street, stocks turned in a mixed performance during trading on Tuesday after ending Monday’s session firmly in positive territory, while the tech-heavy Nasdaq showed a notable pullback, the Dow climbed to a new record closing high.

The Dow ended the day up 133.86 points or 0.4 percent at 38,467.31, while the Nasdaq slid 118.15 points or 0.8 percent to 15,509.90. S&P 500 bounced back and forth across the unchanged line before closing down 2.96 points or 0.1 percent at 4,924.97.

Meanwhile, the major European markets all moved to the upside on the day. While the German DAX Index crept up by 0.2 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index climbed by 0.4 percent and 0.5 percent, respectively.

Crude oil prices moved sharply on Tuesday, largely offsetting the steep drop in the previous session after the International Monetary Fund raised its global growth forecast for 2024. West Texas Intermediate for March delivery jumped $1.04 or 1.4 percent to $77.82 a barrel.