Tuesday, November 30, 2021

Asian stocks fall on rising energy costs, fan inflation fears

Shares in Asia fell on Tuesday as rising oil, coal and other energy prices raised concerns over inflation.

Benchmarks declined in Tokyo, Hong Kong and Shanghai. Oil prices tumbled after US benchmark crude oil closed above $80 a barrel on Monday. For the first time in seven years, it traded above $81 a barrel on Monday.

Oil, coal and natural gas prices are climbing, adding price pressure that could cause the Federal Reserve and other central banks to backtrack more quickly on their support for the markets.

Tokyo’s Nikkei 225 index fell 1% to 28,216.15 and Hong Kong’s Hang Seng also fell 1% to 25,066.05. The Shanghai Composite Index fell 1% to 3,554.38 and the S&P/ASX 200 slipped 0.4% to 7,272.90.

Shares also declined in India and Taiwan, but rose in Jakarta and Bangkok.

Energy demand has jumped faster than production as economies recover from the pandemic, driving higher prices. Other factors, including a shortage of truck drivers, shipping disruptions, flooding of coal mines in China and droughts affecting hydroelectric power generation, are also driving up prices.

“Energy Crisis Uncertainty will keep crude prices high unless the oil market is likely to move towards equilibrium. The natural gas shortage is not going away anytime soon and this will lead to additional demand for crude oil,” Edward Moya of Oanda said in a comment.

US benchmark crude oil slipped 13 cents to $80.39 a barrel in electronic trading on the New York Mercantile Exchange. It rose 1.5% to $80.52 a barrel on Monday.

Brent crude, the international pricing standard, fell 6 cents to $83.59 a barrel.

On Wall Street, stocks closed broadly lower on Monday, with the S&P 500 down 0.7% at 4,361.19. The Dow Jones Industrial Average also fell 0.7% to 34,496.06 and the Nasdaq fell 0.6% to 14,486.20. Most of the sectors remained in the red mark.

Read Also:  Mancini calls up Pobega for decisive World Cup qualifier

Technology and communications stocks were some of the biggest losers. Facebook fell 1.4% and Intuit 1.1%.

Bond trading was closed due to the Columbus Day holiday.

Investors are eagerly awaiting the company’s earnings debut this week.

Companies across a wide range of industries are warning that supply chain problems and high raw material costs could erode their financial results for the rest of the year. Wall Street is closely monitoring whether those higher costs and higher prices for commodities will hurt consumer spending, a key driver of economic growth.

Stocks are swinging between gains and losses as investors try to better understand the direction of economic recovery during the rest of the year.

Banks will be among the first majors to report their latest financial results and give investors more insight into how companies are faring amid concerns over the lingering virus pandemic and rising inflation.

JPMorgan Chase announced the results on Wednesday. Bank of America, Wells Fargo and Citigroup will report results on Thursday.

Delta Air Lines will report its latest results on Wednesday. The airline industry is still struggling to recover from the pandemic shutdown that began 18 months ago. Investors will be closely monitoring the industry’s results to see how much of an impact the summer surge of COVID-19 cases has had on the industry.

Investors are also looking forward to economic data this week that could shed more light on what is happening with inflation. The Labor Department will release its Consumer Price Index on Wednesday and its Producer Price Index on Thursday. The report details inflationary pressures on consumers and businesses.

The US dollar rose from 113.32 yen to 113.33 Japanese yen late Monday. The euro rose from $1.1553 to $1.1557.


NWN Business Writer Damien J Trois contributed.


Nation World News Deskhttps://nationworldnews.com
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
Latest news
Related news
- Advertisement -