Asian Stock Market: China, Australia lead bears amid sluggish day, strong yields

  • Asia-Pacific equity markets grind lower amid lack of major data.
  • China’s lockdown in Xi’an, multi-year high Treasury yields keep bears hopeful.
  • Indian shares buck the trend amid strong earnings report.
  • Wall Street closed lower on firmer US data, hawkish Fedspeak.

Asian stock markets remain mostly lower as multi-year high Treasury bond yields join a lack of major data/events on Friday. Also negatively affecting the region’s equities are fears of higher inflation and central bank meddling to defend the respective currencies in Japan, China and India. Furthermore, fresh covid fears from China exert additional downside pressure on the market sentiment amid a sluggish session.

While portraying the mood, MSCI’s Index of Asia-Pacific shares outside Japan prints 0.50% intraday gains whereas Japan’s Nikkei 225 drops to the same tune as we write.

Elsewhere, India’s BSE Sensex adds 0.40% at the latest, following an upbeat start, amid firmer company earnings. “Indian shares opened higher on Friday, as strong earnings reports, including from Axis Bank, helped resist the weakness in global markets on fears of the impact of aggressive rate hikes from central banks on economic growth and corporate results,” stated Reuters.

On the other hand, Chinese stock remains pressured after witnessing a corrective bounce the previous day as policymakers announce fresh covid-led lockdowns in Xi’an. “China locked down parts of the central metropolis of Xi’an, confining some of the city’s 13 million people to their homes for at least a week, and other major hubs are rolling out virus restrictions in a reinforcement of the country’s commitment to covid zero,” per Bloomberg.

It should be noted that an eight-year high core Consumer Price Index (CPI) from Japan and looming fears of Tokyo’s meddling to defend the yen, as well as the same hopes from policymakers in China and India, keeps the risk appetite weak.

Australia’s ASX 200 drops nearly 0.80% intraday as traders await the annual budget and expect downbeat growth and firmer inflation ahead. On the same line, New Zealand’s (NZ) NZX 50 also holds lower ground even as NZ trade numbers printed upbeat figures for September.

On a broader front, the US 10-year Treasury bond yields refreshed a 14-year high the previous day, around 4.22% by the press time. Also, the two-year US Treasury yields rose to the highest levels since 2007 before recently taking rounds to 4.62%. It’s worth noting that Wall Street closed in the red following an initially upbeat performance while the S&P 500 Futures extend the previous day’s losses with 0.50% intraday downside at the latest.

Also read: S&P 500 Futures pare weekly gains as yields dribble around multi-year high

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