Tuesday, January 18, 2022

Indian Morning Briefing: Most of Asian markets fall after Wall Street’s tech-driven fall

GLOBAL MARKETS 
DJIA             36113.62   -176.70    -0.49% 
Nasdaq           14806.81   -381.58    -2.51% 
S&P 500           4659.03    -67.32    -1.42% 
FTSE 100          7563.85     12.13     0.16% 
Nikkei Stock     27956.98   -532.15    -1.87% 
Hang Seng        24296.53   -133.24    -0.55% 
Kospi             2924.76    -37.33    -1.26% 
SGX Nifty*       18239.00     -61.5    -0.34% 
*Jan contract 
 
USD/JPY    113.79-80  -0.33% 
Range      114.23   113.75 
EUR/USD    1.1464-67  +0.10% 
Range      1.1470   1.1452 
 
CBOT Wheat March $7.466 per bushel 
Spot Gold $1,820.13/oz -0.1% 
Nymex Crude (NY) $81.50 -$1.14 
 
 
US STOCKS 

The S&P 500 and Nasdaq Composite both fell as technology stocks tumbled in the stock market.

The S&P 500 dropped 1.4%, while the tech-heavy Nasdaq Composite dropped 2.5%. The Dow Jones Industrial Average fell 0.5%.

Technology stocks have come under pressure in the new year on rising government bond yields. Higher yields can reduce the appeal of future earnings promised by many tech stocks. The S&P 500’s technical sector fell 2.2% for the session, reducing its year-over-year loss to 5.2%.

The biggest US stocks helped drag the market down, with shares of Apple falling 1.5% and shares of Microsoft down 3.8%. More financially sensitive parts of the stock market outperformed, with the S&P 500’s industrial sector up 0.3%.

 
 
ASIAN STOCKS 

Japanese stocks were lower in morning trade, led by losses in electronics and real estate stocks, as the yen strengthened amid economic uncertainty over the Omicron version. Investors were focused on the trends in the Covid-19 transition and the government’s countermeasures. The Nikkei stock average was down 1.9% at 27947.28.

South Korea’s Kospi fell 0.7% to 2940.47 in early trade, tracking Wall Street’s tech-driven decline on lewd comments from Fed officials. Internet, biotech and energy stocks were low. Investors remained largely on edge ahead of the Bank of Korea’s rate decision later in the day.

Hong Kong’s Hang Seng index was 1.1% lower at 24150.35, weighed down by a sell-off in tech stocks. KGI Securities expects profit-taking pressure on Hong Kong stocks after Chinese internet stocks fell sharply in the US ADR market. The Hang Seng Tec Index slipped 3.1% to 5620.11.

Chinese stocks were mixed in early trading, with widespread losses among coal miners, property developers and the energy sector. Soocho Securities said the overall market was on a weak trajectory and Thursday’s decline dampened investor enthusiasm. The Shanghai Composite Index fell 0.8% to 3528.14, the Shenzhen Composite Index slipped 0.1% and the Chinanext Price Index gained 0.2%.

 
FOREX 

The JPY strengthened against the G10 and Asian currencies, as sharp comments from several Fed officials encouraged risk aversion while fueling the safe-haven attractiveness of the Japanese yen. MUFG Bank said markets are panicking following comments by Fed officials on the US central bank’s focus to aggressively fight inflation. However, there may be some flexibility between regional currencies going forward, as fundamentals in Asia begin to improve and the Covid-19 situation becomes more controlled, MUFG Bank said. USD/JPY slipped 0.4% to 113.77, AUD/JPY fell 0.5% to 82.72 and SGD/JPY fell 0.4% to 84.55.

 
METALS 

ANZ said gold prices declined despite continued weakness in the US dollar as higher inflation prompted investors to worry about more drastic action from the Federal Reserve. This week’s data showed an uptick in inflation, and Fed officials have since warned that the central bank will have to hike rates more aggressively this year if inflation remains high during the first half. Many analysts were expecting the Fed to hike rates about three times this year, but the latest comments from officials suggest four hikes are likely. Spot gold fell 0.1% to $1,820.13 an ounce.

 
OIL SUMMARY 

Oanda said oil prices fell in early Asian trade as political pressure mounts for the White House to lobby OPEC+ to ensure the group meets its production targets amid supply disruptions. The short-term outlook for travel demand was also likely to be worsened by the spread of the Omicron variant, with Oanda citing Delta CEO Ed Bastian as saying he expects a rebound in travel to be delayed by 60 days. Front-month contract for WTI was down 0.4% at $81.67/bbl, while front-month Brent crude was down 0.4% at $84.08/bbl.

 
 
TOP HEADLINES 
China 2021 Exports Rose 21.2% On Year in Yuan Terms 
Biden Will Nominate Raskin as Top Fed Banking Regulator 
Fed's Waller Says High Inflation Caught Central Bank Off Guard 
Tech Stocks Drag Down S&P 500, Nasdaq Composite 
Fed's Evans: Time to Move Toward Tighter Monetary Policy 
Bank of Korea Raises Rate Back to Pre-Pandemic Level 
Producer-Price Increases Slowed From Record Pace in December 
Jobless Claims Rise to 230,000 
Mortgage Rates Jump to Highest Level Since March 2020 
U.S. to Deploy Military Medical Teams to Help Ease Strain on Hospitals 
China's 11th-Hour Tax Reprieve Cheers Foreign Workers-For Now 
White House Convenes Open-Source Security Summit Amid Log4j Risks 
Jan. 6 Panel Subpoenas Reddit, Twitter and Parent Companies of Google and Facebook 
Elon Musk, Celebrities Criticize California's Plan to Cut Solar Subsidies 
Supreme Court Blocks Biden Vaccine Rules for Private Employers, Allows Them for Healthcare Workers 
Citigroup to Sell Consumer-Banking Franchises in Four Southeast Asian Countries 
Microsoft Board to Review Sexual Harassment, Gender Bias Policies 
With Biden Mandate Blocked, Many Companies Won't Impose Covid-19 Vaccine Rules 
Eye-Care Company Bausch & Lomb Files for IPO 
AirAsia Not Granted Extension in Financial Distress Classification Appeal 
Tiger Woods-Backed SPAC Files for IPO 
Monster Beverage Buys Owner of Craft Breweries Cigar City, Oskar Blues for $330 Million 
 
 

(END) Dow Jones Newswires

01-13-22 2215ET

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