Asian Markets Mostly Lower Amid Cautious Trading

Asian stock markets are mostly lower on Wednesday, following the mixed cues overnight from Wall Street, as traders are cautious ahead of the Federal Reserve’s monetary policy announcement and about the likely impact of Chinese real estate major Evergrande’s debt woes on other economies. Asian Markets closed mixed on Tuesday.

Traders also continue to weigh the likely impact of the spread of the delta variant of coronavirus in the region and some other countries, particularly in the U.S., on the pace of economic recovery from the pandemic.

The Australian stock market is modestly higher in choppy trading on Wednesday after being in the red most of the morning session, extending the gains in the previous session, with the benchmark S&P/ASX 200 just below the 7,300 level, following the mixed cues overnight from Wall Street, with energy stocks supporting the market, even as the domestic coronavirus situation remains a concern, particularly in New South Wales and Victoria.

NSW recorded 1,035 new local cases and five deaths on Tuesday. Victoria has recorded 628 new cases of COVID-19 and three deaths, with 6,223 total active cases across Victoria.

The benchmark S&P/ASX 200 Index is gaining 61.50 points or 0.85 percent to 7,335.30, after hitting a low of 7,241.80 and a high of 2,336.70 earlier. The broader All Ordinaries Index is up 68.50 points or 0.91 percent to 7,631.60. Australian stocks ended modestly higher on Tuesday.

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

Oil stocks are higher. Woodside Petroleum is gaining more than 2 percent, Beach energy is rising almost 3 percent and Santos is adding almost 1 percent, while Oil Search and Origin Energy are up more than 1 percent each.

In the tech space, WiseTech Global is losing almost 1 percent and Appen is edging down 0.4 percent, while Xero is gaining almost 1 percent and Afterpay is edging up 0.2 percent.

Among the big four banks, Westpac and National Australia Bank are losing almost 1 percent each, while Commonwealth Bank is edging down 0.4 percent. ANZ Banking is edging up 0.1 percent.

Westpac has terminated its talks with financial services firm Kina Securities over the sale of its major stake in Westpac PNG Ltd.

Among gold miners, Evolution Mining, Newcrest Mining and Northern Star Resources are edging down 0.3 percent each, while Gold Road Resources is losing almost 2 percent and Resolute Mining is down almost 1 percent.

In other news, shares in Lumos are plunging more than 11 percent after the U.S. FDA stopped the review of the medical diagnostics firm’s rapid antigen COVID-19 test.

In the currency market, the Aussie dollar is trading at $0.725 on Wednesday.

The Japanese stock market is modestly lower in choppy trading on Wednesday, extending the sharp losses in the previous three sessions, with the benchmark Nikkei index below the 29,700 level, following the mixed cues overnight from Wall Street, as continued worries about potential collapse of China’s real estate firm Evergrande dented sentiment, even as traders remain concerned about the domestic coronavirus situation.

Meanwhile, the Bank of Japan will wrap up its monetary policy meeting on Wednesday and then announce its decision on interest rates. The bank is widely expected to keep its benchmark lending rate steady at -0.1 percent, although other forms of stimulus may be introduced. Traders’ speculation on the likely central bank commentary on the domestic economic and foreign trade scenario also impacted sentiment.

The benchmark Nikkei 225 Index closed the morning session at 29,665.42, down 174.29 points or 0.58 percent, after hitting a low of 29,573.88 earlier. Japanese stocks closed sharply lower on Tuesday.

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

In the tech space, Screen Holdings is edging up 0.3 percent, while Advantest and Tokyo Electron are edging down 0.3 percent each.

In the banking sector, Sumitomo Mitsui Financial is edging down 0.5 percent and Mizuho Financial are down more than 1 percent, while Mitsubishi UFJ Financial is gaining more than 2 percent.

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

Among the other major losers, Marubeni, Sumco, Tokai Carbon, Citizen Watch and Daikin Industries are all losing more than 3 percent each, while Itochu, Taiyo Yuden, Fanuc, Mitsui Mining & Smelting, Sumitomo Heavy Industries, Japan Steel Works, Shizuoka Bank, Mitsui & Co. and Hitachi Construction Machinery are down almost 3 percent each.

Conversely, SKY Perfect JSAT is gaining more than 3 percent, while Mitsui Fudosan, Mitsubishi UFJ Financial Group and Kawasaki Kisen Kaisha are gaining more than 2 percent each.

In the currency market, the U.S. dollar is trading in the lower 109 yen-range on Wednesday.

Elsewhere in Asia, Taiwan is plunging 2 percent, while China, Singapore and Malaysia are lower by between 0.3 and 0.6 percent each. New Zealand and Indonesia are up 0.4 and 0.9 percent, respectively. The South Korean market is closed on account of Chuseok Festival and Hong Kong market is closed as the day following the Chinese Mid-Autumn Festival.

On Wall Street, stocks showed a lack of direction over the course of the trading session on Tuesday following the sell-off seen during trading on Monday. The major averages spent the day bouncing back and forth across the unchanged line before closing narrowly mixed.

While the Nasdaq rose 32.50 points or 0.2 percent to 14,746.40, the Dow dipped 50.63 points or 0.2 percent to 33,919.84 and the S&P 500 edged down 3.54 points or 0.1 percent to 4,354.19. The Dow ended the session at its lowest closing level in three months.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.’s FTSE 100 Index jumped by 1.1 percent, the German DAX Index and the French CAC 40 Index surged up by 1.4 percent and 1.5 percent, respectively.

Crude oil prices moved higher Tuesday, ahead of weekly U.S. crude inventories data. But gains were just modest as traders weighed global energy demand prospects amid the surge in coronavirus cases in the U.S. and several other countries. West Texas Intermediate Crude oil futures for October settled at $70.56 a barrel on the expiration day, gaining $0.27 or 0.4 percent in the session.

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