- Nikkei225 is facing immense heat on gloomy global outlook post interest rate hikes by Western central banks.
- Debt-laden firms in the US economy will have a nightmare in CY2023 as they will face higher interest obligations.
- Oil prices are displaying a lackluster performance in the absence of updates on pipeline shutdown in the US.
Markets in the Asian domain are majorly facing intense volatility following the footprints of S&P500. Global economic projections have weakened further as the European Central Bank (ECB), the Bank of England (BOE), and the Swiss National Bank (SNB) have traced the size of an interest rate hike by the Federal Reserve (Fed). All European central banks have hiked their interest rates by 50 basis points (bps) in their last monetary policy of CY2022 to tame galloping inflation except the SNB where inflation is just above 2%.
At the press time, Japan’s Nikkei225 plummeted 1.77%, ChinaA50 added 0.20%, Hang Seng added 0.10%, and Nifty50 remained flat.
Asian equities have turned cautious after a poor show by S&P500 on Thursday. The 500-stock basket of the United States dived significantly as higher interest rate peak projection by the Fed has strengthened recession fears. Debt-laden firms in the US economy will have a nightmare in CY2023 as they will face higher interest obligations.
Japanese equities have failed to deliver a recovery despite the upbeat preliminary Jibun Bank PMI data. The Manufacturing PMI has improved to 48.8 vs. the projections of 48.0 but remained lower than the former release of 49.0. And, the Services PMI has escalated to 51.7 against 51.1 as expected and the former release of 50.3.
On the oil front, oil prices have turned sideways in a tad wider range after a stellar recovery from an 11-month low marginally above $70.00. A sideways auction profile in the West Texas Intermediate (WTI) futures is expected to continue its upside journey amid an absence of updates on a major pipeline shutdown from Canada to the United States.
